This assignment is meant to test your knowledge of the financial statements, their ratios, and your assessment of a company’s financial welfare. Choose a publicly-traded company (I chose Disney) that is located on either the NYSE or NASDAQ. Download and use its most recent annual report and analyze their financial statements and the key parts of their Form 10-K. Complete the following requirements with a final professionally prepared presentation. In conclusion, please provide the company’s financial strengths and weaknesses and your overall assessment of the financial health of the firm. Is your recommendation to buy, hold or sell? You will be graded on the items below: 1. Describe the type of business/sector/industry in which your company operates. How well has the firm performed in this sector? (10%) 2. Hit on key points from the letters from the CEO and the chairman and discuss any information learned from these letters that might be useful to an analyst. What material information was said about the company’s previous results and hints towards future business? (10%) 3. What type of audit opinion was given for the financial statements and the internal financial controls of the company? (10%) 4. Read the Management Discussion and Analysis (MD&A). Discuss whether the items that should be addressed in the MD&A are included. Support your answer with examples from the companies MD&A. What are your major concerns? What are the company’s major strengths? (10%) 5. Prepare a common-sized balance sheet and income statement for the company for all years presented and include either an industry average or a key competitor’s % (I chose comcast) – provide analysis of key variances (10%) a. Calculate the sales growth and operating expense growth for each two-year period presented. Discuss the important points that an analyst would use in assessing the profitability of your company. b. Highlight areas that might indicate a concerning trend. 6. Analyze the A/R and allowance accounts. What does this tell you about the company’s sales? (10%) 7. Describe any major (material) commitments and contingencies of the company. Do these present serious problems? (10%) 8. Using the consolidated statements of stockholders’ equity for your company, explain the key reasons for the changes in the common stock, accumulated other comprehensive income and retained earnings accounts. Evaluate any key changes. (10%) 9. Summarize the company’s statement of cash flows for all three years: Operating, Financing and Investing activities – identify any material changes for the most recent year. (10%) 10.Prepare ratio-analysis (time series and cross sectional). Evaluate and analyze its short- term liquidity, operating efficiency (activity), capital structure and long-term solvency (debt or leverage), profitability, market measures and a discussion of any quality of financial reporting issues. (10%)