Please follow these instructions before you start to work in this report. 1- Be sure that you have read and understand the chapters 1 to 5.

  • You must read at least the latest 3 years SEC 10K Reports from your company, especially the PART 1 section business description, risk and legal (Report 1 would help you in this issue)
  • You must have the latest 5 years SEC 10K Reports from your company, you can access YahooFinance or the company official


Requisites for this second report. You most turn in two files, one excel file and one word document. Below are the instructions for each file.

Excel File Instructions

  • Attach you have one excel file that is called FinSAS Clean Example.XLS, download the file and rename the file with the ticker of your company, if your company is Walmart, then the name of the file is WMT.XLS the ticker had sent to you from your professor at the beginning of the
  • Open the new renamed file then READ the instructions TAB. Don’t plug in any number if you haven’t read the instructions
  • The excel file has a TAB called INPUT, you must enter the data of the income statement (IS) and balance sheet (BS), you must use the SEC 10K Report information from the last five
    • Be careful about how you enter the financial data, sometimes on the excel file, net sales mean’s total revenues for your company, or your company is a service company that does not need inventory, at the end all concepts either are equal or similar in terms of concept
    • Also be careful about positives and negatives numbers, for example on the excel file expenses are subtracted from the income or cost, but your company may use negative number so you need to be aware about double subtraction or
    • At the end, both statements, IS and BS should be exactly the same as is shown in their respective SEC 10K Reports. Each error is
    • Be completely sure that the Balance Sheet is balanced, or that Assets equals Liabilities and Equity for every fiscal year. This is the most important accounting equation so errors at this level are also penalized.
    • Also you need to create or insert one TAB named NOTES and you must include the notes to the financial Statement’s from the 10k report, yes BS and IS
  • There is one additional section that you at this point will leave almost in blank, this section is called OTHER DATA on the INPUT TAB row 104. From this section the only required data is the ROW 118 Cash Flow from Operations, you will find this information on the Cash Flow Statement from your company, specifically cash flow from operations activities. After you entered all the financial data, automatically you must have the calculations for the vertical, horizontal and
  • Once you have entered the BS and IS, you will have the output tabs, Vertical, Horizontal and Ratios AVG or END analysis. These tabs are going to be the raw material for the word document and Ratio


Word Document.

Your report should include the following sections: 1- Balance Sheet.

Make a report where you can conclude about the link between the Business Strategy Analysis reading on the business section part 1 from the 10K’s reports and how the company use the Resources (Assets) and how those resources are financed (Liabilities) to expand the operations during the last 5 years. Are the resources and finances aligned to the firm Strategy? What is the best balance sheet for my company using the current strategy as a context?

  • Income

Include in your report where you can conclude about company cash cow product, it means your most important service or product from your company. In terms of margins, in terms of sales, in terms of volume, in terms of those product or services that provide or increase substantially the PROFITS or GROSS MARGIN. Explore this question what’s the best IS for my company using the current strategy as a context? in other words have the strategic decisions from the past translated into better income statement for my company? Explore these variables or questions, Have my company increased sales, inventories and account receivables at the same velocity? Have my suppliers helped me in these operations increments? Have my company operated better the business? Have my products and services improved the efficiency in terms of my competitors?


3-  Basics of Analysis (BS) (Common Size Analysis or Vertical and Horizontal Analysis (VAHA))

The BS force us to make the RIGHT QUESTIONS, so there will be several questions for this section, find the 10 most important QUESTIONS resulting from the Vertical Analysis and Horizontal Analysis performed to the BS and IS for your company (see tab’s named vertical and horizontal analysis) ANSWER THE 10 QUESTIONS visiting the section of MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL RESULTS OF OPERATIONS inside SEC 10k reports. You

need to use the last 5 years SEC 10K Reports depending of the year of variances.

Note: if you are feeling that you cannot identify the RIGHT questions raised by the Basic of Analysis Exercise then, you must read again the module related with the topic. Also questions and answers for each company are different, the BS analysis will drive the Q&A process. See the example NetSuite.Doc.

  • Ratio Analysis and Interpretation. As you approach the TAB ratios AVG or END you will notice a series of ratios, create new TAB and copy all ratio results, then evaluate each of the ratio and conclude about the perspective position. See the example of EXXON MOBILE



  • Due reports are penalized with 50% for one minute, one hour or one Later 10% per day. No exceptions.
  • The extension can vary, but I expect minimum 5 pages Single space, times new roman font, 10 size font and .5 inch margin all around.
  • Errors on IS and BS are penalized with 10 points. 4- Unbalance BS with 20%

5- Incomplete reports 20% for each particular section or question. We have 4 sections to fulfill. 6- Not follow the instructions disclosed here in this document 10% each.