Using recent financial data(IS, BS, and Stmt. Of Cash Flows) of the company of your choice, you as Chief
Financial Officer of the company are required to diagnose its current operations and financial conditions.
In order to perform “checkups” on various aspects of the financial health of your company, you may
conduct the financial ratio analysis. Also, as demonstrated in class, you need to conduct a bankruptcy
prediction model for your company. So, the project consists of two parts;
I)Data Step: Choose a non-financial and non-online company (publicly held).
Prepare your company’s recent five year financial statements (B/S, I/S, and stmt.of cash flows, etc.)in the
sheet tab named “Financial Data.” Recent financial data are available for download from Mergent Online
database. (If all the five year data are not available, then, use the financial data for only available years).
–See
a separate document, named ‘Guidelines for Data Mining’) for more detailed procedures.
II) Analysis Step: First, construct common size Balance Sheet and Income Statemen on sheet tab
“Common
Size B/S &I/S.” Then,calculate the financial ratios using the definitions provided on sheet tab
“Analyses.”You
need a benchmark to compare the current financial ratios. Use either the industry average ratios or
historical
average ratios of the company as the benchmark. You may find the industry average ratios from Mergent
online database as demonstrated in the document, ”Guidelines for Data Mining’. All of your analyses
should be
conducted in the sheet tab named “Analyses.”
Required:
1) Complete data step. Data from Mergent Online. Make sure to import financial data in the format of
“Standardized.”
2) Fill the excel template in sheet tabs ” Financial Data,” “Common Size B/S and I/S.” and “Analyses”
3) Report: Conduct comparative analysis using the financial ratios and their benchmarks. State any
significant
changes(improvement or deterioration) in the comparative analysis.
Sample Solution
