ANNE TAYLOR STORES CORP.
WHAT DEPRECIATION METHODS DOES YOUR FIRM USE?
DOES YOUR FIRM OWN ONE OR MORE SUBSIDIARIES?
DID YOUR FIRM ACQUIRE OR DISPOSE OF ANY SUBSIDIARIES OR INVESTMENTS IN OTHER FIRMS DURING THE MOST RECENT YEAR? - SEE NOTES TO FINANCIAL STATEMENTS. IF SO, PROVIDE DETAILS.
The following ratios yield information about a company's use of long term assets. The computational formula and the information content of each is explained below.
• Long term assets to total assets equals long term assets
• divided by total assets. This ratio yields information about
• a firm's financial flexibility. The larger the portion of long
• term assets, the less flexibility the firm has to change its
• strategies quickly.
• Sales to average fixed assets equals sales divided by
• average fixed assets. This ratio measure productivity of
• the fixed assets. It shows how many dollars of sales were
• generated by each dollar invested in fixed assets.
COMPUTE EACH OF THE RATIOS FOR THE MOST RECENT YEAR.
STUDY THE LONG TERM LIABILITIES AND SUMMARIZE THE SIGNIFICANT CHANGES.
WHAT ARE THE APPROXIMATE INTEREST RATES INCURRED ON YOUR FIRM'S LONG TERM LIABILITIES - SEE NOTES TO FINANCIAL STATEMENTS.
WHICH TYPE OF PENSION PLAN DOES YOUR FIRM HAVE?
DID YOUR FIRM HAVE ANY CONTINGENT LIABILITIES AT THE BALANCE SHEET DATE? DISCUSS THE SPECIFIC NATURE AND HOW THEY ARE EXPECTED TO AFFECT THE FIRM'S FINANCIAL HEALTH - SEE NOTES TO THE FINANCIAL STATEMENTS.
The following ratio is computed to provide information about how a company is managing its long term liabilities.
Debt to total assets ratio equals total liabilities divided by total assets. This ratio reveals the percentage of assets that are financed by debt. This is financial leverage. The higher degree of financial leverage, the higher the risk is that a company will not be able to meet its interest payments and will be forced into bankruptcy.
CALCULATE THIS RATIO FOR THE MOST RECENT YEAR.
SCAN THE EQUITY ACCOUNTS AND INDICATE THE SPECIAL FEATURES OF PREFERRED STOCK.
DID YOUR COMPANY HAVE A STOCK DIVIDEND OR STOCK SPLIT?
COMPUTE THE ABOVE RATIO.
ASSUMING THE ABOVE HAS BEEN FAIRLY CONSTANT OVER THE RECENT YEARS, BRIEFLY EXPLAIN WHAT THIS IMPLIES ABOUT THE COMPANY'S DIVIDEND PAYMENT POLICY.
IDENTIFY THE SEGMENT NAMES AND CURRENT YEAR'S OPERATING INCOME.
DISCUSS THE RESULTS OF YOUR SEGMENT ANALYSIS. WHAT TRENDS DO YOU OBSERVE? ARE SOME SEGMENTS PERFORMING BETTER THAN OTHERS?
PREPARE A THREE YEAR SUMMARY OF CASH FLOWS FROM:
• OPERATING ACTIVITIES
• INVESTING ACTIVITIES
• FINANCING ACTIVITIES
WHAT IS THE NET CHANGE IN CASH EACH YEAR?
WHAT DO YOU CONCLUDE FROM THE ABOVE? DOES THE COMPANY APPEAR TO BE GENERATING A HEALTHY CASH FLOW FROM OPERATIONS, OR IS IT DEPENDING ON CASH FROM OTHER SOURCES?
IS YOUR COMPANY'S CASH OUTFLOW FOR INVESTING COVERED BY CASH GENERATED BY OPERATING PLUS FINANCING?
DOES YOUR FIRM REPORT ANY SIGNIFICANT NONCASH FINANCING AND INVESTING ACTIVITIES? IF SO, PLEASE DESCRIBE.
STATE YOUR OVERALL ASSESSMENT OF THE FINANCIAL HEALTH AND STATUS OF YOUR FIRM. IS IT STRONG, WEAK, IMPROVING, DETERIORATING?
WOULD YOU MAKE A LOAN TO THE FIRM?
WOULD YOU BUY STOCK IN THIS COMPANY?
WOULD YOU INVEST YOUR CAREER WITH THIS COMPANY?
Some other interesting questions that you may wish to address if they affect your particular firm are:
WHAT ARE THE REASONS THAT FOREIGN CORPORATIONS ARE INCREASING THE SALES OF THEIR SECURITIES TO U.S. INVESTORS?
WHAT ARE THE PROBLEMS ASSOCIATED WITH INVESTING IN SMALL, UNKNOWN FIRMS?
DISCUSS THE LEGAL PROCEEDINGS YOUR FIRM IS INVOLVED IN, AND MANAGEMENT'S OPINION OF THE RESOLUTION.
EXPLAIN HOW INFORMATION ABOUT EXECUTIVE COMPENSATION OR RELATED TRANSACTIONS IS USEFUL TO INVESTORS.
WHY DOES THE PRICE OF A BOND INCREASE, WHEN THE INTEREST RATES DECREASE?
WHY ARE COMPANIES SELLING NEW ISSUES OF STOCK? WHAT ARE THE BENEFITS?
MANY COMPANIES ARE REPLACING OLD ISSUES OF DEBT WITH NEW. WHY ARE COMPANIES TAKING THIS ACTION? HOW DO THEY BENEFIT?
You will find the answer to this puzzling assignment inside...