An analyst may perhaps or not observe that this probable indicates that Intel is an enormous power customer and therefore if an analyst considers that power prices will raise, it will affect Intel. C. What type of audit opinion was given for the financial statements and the internal financial controls Of Intel? Explain the key items discussed in the audit reports.
The audit opinion avgas “clean” meaning no exceptions. That is, the financial reports are equally itemized in accordance With GAP and the systems f controls surrounding the financial reporting are working as designed. . 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 Intel MD&A Yes, the MD&A has the main parts needed. The MD&A comprises a synopsis of the financial results, dialogue about strategy, critical accounting estimates, investments, taxes, inventory, accounting changes, results of operations by segment and margins, and restructuring charges.
The concussion contains the business outlook, the use of fair values, but I didn’t discover the section on business risk. Id not locate it after checking to see it. E. After reading the MD, discuss the future prospects of Intel. Dowdy have any concern? If so, describe those concerns. The projections look very decent.
They have firm outcomes and a strategy that makes clear logic given the market. The thing don’t know about and would be concerned about is the competition, My biggest concern is; what if Microsoft wants to make devices? Intel is equally reliant on computer creators currently. External dangers are not deliberated that much because Intel cannot control it or recognize too much about it.
The discussion is more about internal actions and back-ward looking financial outcomes. Case 2. 1 Intel Case www. Praiseworthiness. Com/Fraser. Using the annual report, answer the following questions: Prepare a common-size balance sheet for Intel for all years presented. A. Describe the types of assets Intel owns. Which assets are the most significant to the company? Using the notes to the financial statements, discuss the accounting methods used to value assets. What other information can be learned about the asset accounts from the notes?
Have there been significant changes to the asset structure from 2009 to 2010? They possess cash, investments, receivables, inventory, long-lived assets and goodwill. Approximately a third to the assets are property, plant and equipment (PEP). The PEP is depreciated using straight line method over 2 to 4 years for machinery and equipment and 4 to 40 years tort buildings. They get the most out to interest in long-lived assets they build themselves. Per footnote within the chapter, many of the short ND long-term investments are valued at their fair values.
There is wide data about valuations and whether the revaluations are recurring or nonrecurring, There have not been broad changes in benefit structure. The only immense modification is in short term investments (please see excel spreadsheet). B. Analyze the accounts receivable and allowance accounts, c. Describe the types of liabilities Intel has incurred. Which liabilities are the most significant to the company? Have there been significant changes to the liability and equity structure from 2009 to 2010? The most substantial debt is vendor accruals (AP and accrued items) and long term debt.
There has not been a key change from 2009 to 2010 (please see excel spreadsheet). Equity is greater since they distributed some common stock and had earnings (increased RE). D. Describe the commitments and contingencies of Intel. Please note 29 on contingencies describe a number of legal proceedings for which the outcome is uncertain, e, under which classification(s) are deferred taxes listed? What item is the most significant component of deferred taxes? As mentioned in Note B, deferred taxes are list below present assets, encounter assets, and nonoccurrence liabilities.
Share-based compensation is the biggest component of deferred taxes. F, What equity accounts are included on the balance sheet of Intel? Preferred stock, common stock, other comprehensive income and retained earnings. 2. I g, prom the following accounts, prepare a balance sheet for Chester Co. For the current calendar year. Chester Co. Balance Sheet at December 31, 2013 Assets Current Assets Cash $1,500 Accounts receivable 6,200 Inventory 12400 prepaid expenses Total Current Assets $20,800 Property, plant and equipment 34,000