An introduction that gives the background information on the company’s history, current product
line, product or brand identity, overseas subsidiaries (if any), and current US and international
Course Project
BA425 Managerial Finance
© 2013. Any unauthorized reproduction or distribution of this material is prohibited without express
written permission from the Provost at New Charter University. Students are expected to maintain the
integrity of the assignment by refraining from reproducing or posting the assignment or their completed
work where it can be viewed by current or future students.
market share. This introduction should be written in paragraph form and will be between one to
two pages.
2. Copies of the company’s financial statements from the past five years, including the current year.
You can find this information on via the links provided to the companies’ websites. If you have
chosen your own company, be sure to check that you have access to the company’s financial
statements before starting the project.
3. An evaluation of the company’s financial stability. This section of the report will include the
following components:
a. Your assessment of the company’s financial stability. Analyze the company’s current
financial position, explaining if you think the company has adequate cash flow and assets to
expand internationally while sustaining operations in the United States and referencing the
calculations included in subsections b, c, and d. This overview should be written in
paragraph form and will be between two to three pages.
b. Calculations of the company’s operating income, income before taxes, net income, earnings
per share, and retained earnings for the current year. You can find the information you need
to complete these calculations by looking at the company’s current financial statement. For
each figure, include the formula you used and identify the items you used from the financial
statements.
c. Calculations of the company’s sales growth rate, tax rate, and dividends payout ratio data
using financial statements from the past five years. For each figure, include the formula you
used and identify the items you used from the financial statements.
d. Calculations and explanations for each ratio used to determine the company’s financial
stability. Though you will choose which ratios to use, be sure to include ratios from each
type of analysis (liquidity, leverage, profitability). For each ratio, include the formula you
used to calculate the ratio and identify the items you used from the financial statements.
Then write a paragraph explaining why you chose to use this ratio to determine the
company’s financial stability. What does this ratio tell you about the company’s financial
health and why is this information necessary for the evaluation?
4. An evaluation of the country that you recommend for expansion. This section of the report will
include the following components:
a. Your recommendation for where you think the company should expand its operations
and which product it should produce and sell. Included with the project instructions is a
Course Project
BA425 Managerial Finance
© 2013. Any unauthorized reproduction or distribution of this material is prohibited without express
written permission from the Provost at New Charter University. Students are expected to maintain the
integrity of the assignment by refraining from reproducing or posting the assignment or their completed
work where it can be viewed by current or future students.
list of three places for potential expansion and links to their demographic, governmental,
and economic information. Recommend that the company expand into one of these
places. Support this recommendation with analysis about the country’s demographics,
explaining what the target market is for the product and why the product would succeed
in this specific country. Consider elements such as the retail price of the product, what
it’s used for, and who in the new country would want it. (Example: If you are a toy
company that is going to sell and produce tricycles that retail for $50, then you need to
consider a country where wages are high enough that people can afford expensive toys
and there are many children.) If there is a country not on the list that you’d like to
recommend instead, you may do so, but you still must provide the information and
analysis. This should be written in paragraph form and one to two pages. Be sure to cite
where you found your data using APA format.
b. Your evaluation of how the country’s current trade policies, sanctions, taxes, tariffs, and
other information used by regulatory authorities in the country could affect the financial
success of the expansion. Again, if you choose a place on the provided list, you can find
this information by following the included links. Also include information on the
relationship between the country and the United States. Are there any embargos?
Boycotts? Wars? All of these can halt operations and/or cut supply of materials and
inventory needed to produce a product, which could create an immediate loss for the
emerging product. Explain any potential problems, or if you don’t anticipate any
problems, explain why. This should be written in paragraph form and one to two pages.
Be sure to cite where you found your data using APA format.
5. A forecast of how the company will fare financially as a result of the expansion. This section of the
report will include the following components:
a. Pro forma financial statements (income statements and balance sheets) for the first five
years of expanded operations. Use the country’s demographic data from section 4 to help
identify probable income. Again, if you choose a place on the provided list, you can find this
information by following the included links. In making your projections, consider the
average real estate prices and potential monthly payments for a suitable building in the new
place, estimated payroll based upon current payroll trends within the new place, and
marketing expenses to establish the product line, as well as how inflation rates, anticipated
income taxes rates, or other information may affect the company’s financial situation during
the expansion.
Course Project
BA425 Managerial Finance
© 2013. Any unauthorized reproduction or distribution of this material is prohibited without express
written permission from the Provost at New Charter University. Students are expected to maintain the
integrity of the assignment by refraining from reproducing or posting the assignment or their completed
work where it can be viewed by current or future students.
b. Calculations on the sales growth rate, tax rate, and dividends payout ratio based on the
information provided in the pro-forma financial statements. For each figure, include the
formula you used and identify the items you used from the financial statements.
c. Calculations of the estimated value of the company’s common and/or preferred stock. (Tip:
This information can be found via the company’s website or Hoovers.com.) To find these
values, you will use formulas such as earnings per share, retained earnings, and
shareholder’s equity. For each figure, include the formula you used.
d. Using the stock calculations and the pro-forma financial statements, create an itemized
report on the anticipated transfer of all assets (cash, property, stocks, and bonds) from the
parent company to sustain operations of the subsidiary. Be sure to also show the balance of
those itemized assets still held by parent company to sustain U.S. operations and provide
explanation on how the assets were divided.
6. A conclusion that summarizes your main findings and your recommendations for expansion based on
your financial analysis. This should be written as a report that will be given to the CEO and Board of
Directors. In it, you must use the results from your financial calculations to support your
recommendation. Be sure to address the potential profit, loss, international market issues, and
international laws. You should also address how this expansion could be influenced by or influence other
global trade and expansion within your market. This should be written in paragraph form and three to
four pages.
