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...nce at each class. Missed Classes: If you miss a class or part of a class for any reason, you should submit an expanded detailed written report (generally four or five pages) on the case in which you were not in class for the discussion. Problem solutions due on the day you miss should be submitted with an additional page discussing relevant issues relating to the problem. This will allow full credit for the assignments due when you where not in class to participate in the discussion. Homework submitted late without the expanded write-up or assignments submitted on time but you did not attend the class will receive a maximum of half credit. EDGAR Database of corporate information assignment: Analyze a company by accessing the EDGAR Database through the Internet. Write a two-page, double-spaced, computer printed report about a company of your choosing from information obtained from the EDGAR Database. Your report will be evaluated for writing quality and your ability to communicate information about the company you select. EDGAR is an acronym for Electronic Data Gathering, Analysis, and Retrieval system, and it is accessible through the World Wide Web on the Internet. Most of the reports filed with the Securities and Exchange Commission (SEC) are available electronically through the SEC’s EDGAR Database. Companies with publicly traded stock must file reports with the SEC. There are many different reports, and each are referred to by a different number. The most common are 10-Ks and 10-Qs. The 10-K is a company’s annual report, and is very similar to the annual report it will publish for general distribution to stockholders, creditors, and other parties. The major difference between the 10-K filed with the SEC and the annual report distributed to stockholders, etc., is the absence of pictures in the 10-Ks and the fact that the 10-Ks often contain more detailed information. The 10-Qs are quarterly reports. The normally contain less detail than the 10-Ks. Instructions to retrieve data from the SEC’s EDGAR database are given below. You may select any company. Some suggestions are: Kmart. Pep Boys, Maytag, Gap Inc., Microsoft, Wendy’s, and Pepsi Co. Using the most current 10-K available for the company you select, briefly discuss the company. Some of the items you should include are: Brief history of company Major Product lines Major markets (countries) in which company operates or sales products Growth and profitability trends Potential as a good investment INSTRUCTIONS FOR ACCESSING THE EDGAR DATABASE THROUGH THE INTERNET After you activate the Internet program on your computer, follow the instructions below to retrieve data from the Securities and Exchange Commission’s EDGAR database. Be aware that the SEC may have changed its interface since these instructions were written. Accordingly, be prepared for slight differences between the following instructions and what appears on your computer screen. 1. To connect to EDGAR, type the following address: http://www.sec.gov/edgar.shtml 2. After the EDGAR home page screen appears, click on Search for Company Filings. 3. From the screen that appears, click on Companies & Other Filers. 4. In the “Company name” window, type the name of the company whose 10-K you wish to retrieve. (The name must be spelled exactly right to access the file.) 5. Click on CIK to view company filings. 6. In the “Form Type” window, type 10-K, then click on Retrieve Filings. 7. Click on desired 10-K report. 8. Click on desired document. 9. Once the 10-K has been retrieved, you can search it on-line or save it on your hard drive or diskette. If you want to save it, do so by using the Save As command from the pull down menu at the top of the screen accessed using most word processing programs. 10. The financial statements are seldom located near the beginning of the company’s 10-K, so it is necessary to scroll down the file until you find them. Typically, they are located about one-half to three-fourths of the way through the report. Article Review Report: Select a major article (at least four pages in length) from Strategic Finance, the official magazine of the Institute of Management Accountants. You may access an article from a current issue by use of the Internet (www.strategicfinancemag.com). Write a two-page, double-spaced, typewritten review of the article. Your paper will be graded on the quality of your writing and your ability to communicate the main points of the article. Attach a photocopy of the article to your two-page review. Grades: Courses grades will be determined as follows: Points Class attendance and participation 9 Cases (3 points each, additional bonus points for superior work) 39 Problems (2 points each) 20 Edgar Database company written report 5 Written article review 5 Final Examination 50 Total points 128 Based on points earned students will receive a course grade in accordance to the grading policy of the MBA program. That policy is as follows: • A Consistently Exceeds high expectations for graduate students • A- Exceeds high expectations for graduate students • B+ Meets high expectations for graduate students (standard for most students) • B Does not meet high graduate student expectations in some areas, but acceptable graduate performance overall. • B- Does not meet high graduate student expectations, and performance needs attention. • C+ & C Varying degrees of unsatisfactory graduate student performance, but enough familiarity with course content that repeating the course will not be required. • C- & below Unacceptable graduate student performance; course must be repeated. MBA Program, Orem Accounting 6350, Accounting Strategies for Achieving Profit Goals Professor Cliff Skousen Date Assignment and Class Discussion Page Jan 7 Course Introduction Class Discussion on International Accounting Issues Reading: Recognizing Revenues and Expenses: When Is Income Earned 2-27 Case: R. J. Reynolds Tobacco Company 2-32 Questions to be addressed: 1. Estimate the effect of trade loading on the RJRT’s and RJR Nabisco’s reported income. Is it material? 2. Does RJRT’s (and the industry’s practice of recognizing revenue on sales to wholesalers seem like a responsible interpretation of generally- accepted accounting principles? 3. Who was helped and who was hurt by trade loading? 4. What are Gerstner’s alternatives in deciding what to do about trade loading? What would you do? Jan 8 Reading: Accounting for Property, Plant, and Equipment and Other Assets 2-72 Case: Kansas City Zephyrs Baseball Club, Inc. 2-97 Question to be addressed: How should Bill Ahern resolve the accounting conflict between the owners and the players? How much did the Kansas City Zephyrs Baseball Club earn in 1983 and 1984? Reading: Solving the Puzzle of the Cash Flow Statement 2-167 Class Discussion on Cash Flow Statements Jan 14 Handout Problems: Indirect Method: Statement of Cash Flow, Eaton Company Direct Method: Statement of Cash Flow, Eaton Company Case: Statements of Cash Flows: Three Examples 2-182 Questions to be addressed: Answer the questions on page 2-187 Jan 15 Reading: Auditors and Their Opinions 3-2 Case: Total Fitness, Inc. (A) 3-10 Questions to be addressed: 1. Using the financial statements for fiscal years 1991 and 1992 (Exhibit 4), prepare a list and analysis of the steps and actions taken by the new management at Total Fitness, Inc. during fiscal 1992 to improve the financial position and stability of the company. In your opinion, is Total Fitness, Inc. in better or worse financial condition at the end of fiscal year 1992 than it was at the end of fiscal year 1991? Why? 2. Study “The Role of the Independent Auditor” and Typical Engagement Letter” in Exhibit 2. Given the restructuring undertaken by management in fiscal year 1992, was the “clean” “Report of Independent Auditors, 1991” justified? What more, if anything, should management and shareholders of Total Fitness, Inc. have expected of the auditors? 3. In your opinion, why did the auditors of Total Fitness, Inc. question the viability of Total Fitness, Inc. in their opinion on the financial statements reporting on and at the end of fiscal year 1992? Was the “going concern” opinion justified? If it was justified, was the auditors’ opinion at the end of fiscal year 1991 faulty? 4. What should be the limits of auditors’ responsibility for the internal control structures, financial condition, and future viability of companies they audit? Reading Handout: Sarbanes--Oxley Act and Public Company Accounting Oversight Jan 21 Reading: Diversity in Accounting Principles: A Problem, a Strategic Imperative, or a Strategic Opportunity? 3-48 Case: Harnischfeger Corporation 3-80 Questions to be addressed: 1. Identify all the accounting policy changes and accounting estimates that Harnischfeger made during 1984. Estimate, as accurately as possible, the effect of these changes on the company’s 1984 reported profits. 2. What do you think are the motives of Harnischfeger’s management in making the changes in its financial reporting policies? Do you think investors will “see through” these changes? 3. Assess the company’s future prospects given your insights from questions 1 and 2 and the information in the case on the company’s turnaround strategy. Reading Handout: Importance of Ethics Jan 22 Reading: Understanding Costs for Management Decisions 4-2 Handout Problems: Detailed Income Statement; CVP Analysis (Alpine, Inc.) Selected Relevant Cost Questions (Barker Company) Case: Precision Worldwide, Inc. 4-8 Question to be addressed: What a...