Objective of this Assignment:
The assignment tests your ability to apply the analytical procedures used by the auditor.
1. Read the content of Module 9 and 10 to prepare for this Assignment.
· You are required to conduct a financial statement analysis of a publicly listed company (PLC) from the following list:
· Brick Brewing Company Limited
· Big Rock Brewery
· Jean Coutu Group
· Indigo Books and Music Inc.
· Magna International Inc.
· Maple Leaf Foods Inc.
· Metro Inc.
· Mitel Networks
· Saputo Inc.
· Second Cup Coffee Company
· SNC-Lavalin Group Inc.
· CGI Group Inc.
· WestJet Airlines Ltd.
· Cineplex Inc.
· Cara Operations Limited
· George Weston Limited
· Loblaws Company Limited
· Celestica Inc.
· Leon’s Furniture Ltd.
· Jean Coutu Group Inc.
· Roots Ltd.
· Canadian Tire Corporation
· Air Canada
· National Canadian Railways
· High Liner Foods Inc.
· Tim Hortons Inc. (uses the name Restaurant Brands International Limited Partnership – uses US GAAP which I will allow for this assignment)
· Rogers Communications
· Alimentation Couche-Tard Inc.
The analysis should be divide in the following three parts:
Part I: Knowledge of the Client’s Business and Risk Assessment (no more than 500 words)
· You should provide an overview of the company’s business, industry it operates in, its products/service, its geographical presence and the details of the top management of the company.
Part II: Analytical Review and Calculation of Critical Financial Ratios
· You should conduct financial ratio calculation and interpretation for the latest year end numbers. No need to show calculations. Only the final result and its interpretation/analytical insights are required.
· Calculate and provide analytical insights of various ratios under liquidity ratios, profitability ratio, and solvency ratios.
· Perform horizontal common size financial statement analysis using 2020 (or the most recent previous year’s data) as the base year and provide analytical insights.
Part III: Audit Report and Risks (no more than 800 words)
· Go into the Annual Report and look for management’s risk analysis – most companies will assess the future business risks of their company.
· Describe one risk facing the company that is interesting and different from all other types of companies – i.e., it is specific to its business – DO NOT DISCUSS ANYTHING TO DO WITH SOFTWARE TECHNOLOGY AS THIS IS COMMON TO ALL COMPANIES
· Go to the Independent Auditor’s Report and identify the auditor of the company and determine if the company receive a clean opinion? How do you know? (2 marks)
· Check for any related party transactions disclosed – you may need to go to the Notes to the F/S unless management has disclosed it in the MD&A (remember Chapter 3 and risk analysis) Select one related party noted and provide details on what was involved in the transaction and who the transactions were with.
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Grammar and spelling check
Assignment Grading Rubric (15%)
All information offered is accurate and all the background information is sufficient for the reader to understand the business.
All the important financial ratios are presented and analytical assessment is conducted. Also, the common size income statement and balance sheet is constructed and the analytical assessment is performed.
Risk factor is identified and described,
Auditors are identified and the audit opinion’s interpretation is provided.
Third party transaction details are provided.
Overall Paper Presentation
Formatted as per assignment details
Correct grammar and spelling is consistently used
No grade allotted, however failure to include proper APA citations and references can result in a 0% and academic sanction.
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