Posted: February 9th, 2015

Whirlpool Analysis

Paper, Order, or Assignment Requirements

ASSIGNTMENT REQUIREMENT

Use the Financial Statement Analysis & Valuation, 3e book as primary source to guide the modules
And use the Whirlpool 10-K 2013 also as the primary source for this project
I will upload the whirlpool 10-k, the notes to financial statements are located in the whirlpool 10-k

This portion of the project coincides with Modules 5-8. Complete the following questions for the project company. You should use this word document as the format for this portion of the project by inserting your responses directly into this document. Do not rearrange the questions in this portion. Answer the questions in the same sequence provided here.

This is a written analysis portion of the project so you should prepare an analysis of each item addressed in the questions. Merely answering the basic question in short answer is not sufficient and will receive an average score. I want to observe critical and analytical thinking. You should answer the questions in your own words. Using large quotes directly from the annual report is not considered analysis. The questions below are suggestions of what to include in your analysis but may not be an all-inclusive listing. You should add to the requested questions as appropriate to the company’s operations.

Disclosure means the Notes to the Financial Statements. Your first resource for responses to the questions in this portion is the Notes to the Financial Statements which is audited information, not the MD&A. Only reference MD&A, or other sources, if you are unable to locate the information in the Notes to the Financial Statements or the questions specifically requests information from MD&A. In your response, reference which note number and the page where you located the information to respond to the each question. If you use a source other than a Note, it should be stated in your response that you were unable to locate the information in the Notes to the Financial Statements and reference the source used.

All questions may not pertain to all companies. If the question does not pertain to the company, note as not applicable with a brief explanation as to why the company would not have the item. Example…Company does not engage in research and development or Company does not operate outside of the US. Reference your research from part one of the project, the company overview and environment research you prepared.

For ratios for which an average is needed, use the year end amount rather than the average. Ratios calculated in this portion of the project also require a written analysis evaluating of the results of the ratios calculated. The ratios should be prepared for the two most current years and the year to year trend should be evaluated. Ratios should also be compared to the industry average if applicable.

Module 5:

What is the company’s revenue recognition policy? Prepare a written analysis of the company’s revenue recognition policy and analyze revenue. This should be approximately one paragraph analyzing and summarizing the revenue policy of the company noting any special policies particular to the company, i.e. use of percentage of completion method. Calculate the percentage increase or decrease in revenue from 2011 to 2012 and from 2012 to 2013. Discuss the revenue trends you note and reference any comments made by management in the MD&A that explain your observations.

Does your company report unearned revenue? If so how is it titled (named), where is it reported and for what amount and from what is it derived? How/when is the unearned revenue recognized?

Does your company have Research and Development? What does the company disclose as it pertains to R&D? What is the R&D as a percent of Revenues for the three years presented by the income statement? Analyze your trend analysis of R&D and comment on your findings. What does the company say about patents in the notes and MD&A. Has the company released any press releases as they pertain to R&D? Discuss these.

Does your company have Restructuring Expenses? If so, what does your company disclose in the notes pertaining to restructuring costs and restructuring plans? What, how much, does the company record for the current year expense? How much liability does the company reflect as of the end of current year? Did the company make any adjustments to the liability during the current year? How did this affect the current year’s income? How much was paid in the current year for restructuring costs accrued? Were there any asset impairments recorded in the current year, how much?

Reviewing your company’s income tax disclosure, what is your company’s statutory tax rate and effective tax rate? What are the current tax, deferred tax and tax provision for the current year? What are the total deferred tax asset, liability and value allowance? What are the primary causes for the company’s deferred tax asset and liabilities?

What if anything does your company disclose concerning Foreign Currency Exchange? What is the current year foreign currency translation adjustment? Explain if the financial statement note disclosures indicate the US dollar weakened or strengthened against your company’s foreign currencies?

Does the company have discontinued operation? If so, describe from what these were derived.

What are your company’s Basic Earnings Per Share and Diluted Earnings Per Share? What types of potential shares are included in the diluted earnings per share? What is the average number of shares outstanding for the year and what is the number of diluted shares?

Module 6

Does your company have Accounts Receivable? If so what is the amount of Allowance for Doubtful Accounts for the current and prior years? What does the company disclose pertaining to the amount provided for uncollectable accounts? Calculate the allowance as a percent of gross Accounts Receivable for the current and prior year and comment on your findings? What are the current year provision for uncollectable accounts and the current year write off? Does this appear reasonable? Comment on your observations.

Calculate the current and prior year Accounts Receivable Turnover and Average Collection Period (Days Sales Outstanding). Comment on your findings.

Does your company have inventory? What does the company disclose concerning its inventory methods and reporting of inventory? If the company uses the LIFO method what is the LIFO reserve (adjustment)? Calculate the Gross Profit Margin for the years reported by the income statement. Calculate the Inventory Turnover and Average Inventory Days Outstanding for the two most current years. Comment on your findings.

What does your company disclose concerning its property plant and equipment (PPE) useful lives and depreciation methods? Has your company reported gains or losses on sales of assets or asset impairments during the current year? If so how much? Calculate PPE Turnover for the two most current years and comment. Calculate average useful life and percent used up. Comment on how this compares to the company’s PPE disclosure.

Module 7

If your company has Accounts Payable calculate Accounts Payable Turnover and Accounts Payable Days Outstanding for the two most current years and comment.

Briefly discuss your company’s disclosure concerning contingent liabilities? What kinds of contingent liabilities does the company have?

Does your company provide Warranties? If so what does your company disclose concerning warranty liabilities? How much liability was accrued and settled in the current year? Analyze the amount of warranty expense as a percent of sales for the two recent years. Have there been any adjustments to the amount accrued? Explain.

Does your company have Long Term Debt? What is the range of interest rates and range of maturity dates for the long term debt? How much debt will mature in the next five years? Compare the notes listed in the company disclosure to the credit rating report you acquired from Standard and Poors. What are the credit ratings for the notes included in the company disclosure? What additional notes has the company obtained since the year end of the financial statements? Explain if the company has the required cash flow in the past three years to meet these obligations.

Briefly discuss the arrangements of your company’s credit facility if any.

Module 8

What types of stock has your company authorized?

How many shares of each type are authorized, issued and outstanding?

How many shares are in the treasury if any?

Does your company have a stock option plan? If so during the most current year how many options were granted and how many were exercised? What was the average exercise price of the options grated and of the options exercised during the year? What was the share based compensation for the year?

Did your company pay dividends during the year? If a cash dividend was paid, how much was this dividend?

ent Events.
– Most of the information are in the Whirlpool 10-k