TOPIC: ANALYSIS OF FINANCIAL ACCOUNTING DOMESCO MEDICAL IMPORTEXPORT JOINT STOCK COMPANY Comparison of financial statements between January 1st, 2010 with December 31st, 2010 DOMESCO MEDICAL IMPORT EXPORT JOINT STOCK COMPANY I. Financial statement analysis: In general meaning, financial statement analysis mentions the art of analysis and the explanation of financial statements. It applies tool and analytical technique to financial statements and relevant documents in order to draw useful estimations and conclusions for business decisions. It is a selective tool to chose “candidates” for investment or merger. It is also a tool to foresee conditions and consequences of the finance in the future
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MÔN HỌC:
TRAINING PROGRAM
OF GLOBAL ADVANCED MASTER OF BUSINESS
ADMINISTRATION
FINAL TEST OF FINANCIAL ACCOUNTING
Lecturer: A.P Dr HA XUAN THACH Student: NGUYEN DO THANH
TP HCM 2012
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DOMESCO MEDICAL IMPORT-EXPORT JOINT STOCK COMPANY
Comparison of financial statements between January 1st, 2010 with December 31st,
2010
COMPANY
Address: No 66, Highway 30, My Phu Ward, Cao Lanh Ciy, Dong Thap Province.
BALANCE SHEET ACCOUNTING
5.2
4.64.6
-
-4,211,794,000
10,330,950,000 (6,119,156,000)
III Short-term receivables
1 Receivables for customers
2 Advances for sellers
3 Other receivables
4 Provision for bad short-term debts
130
131132135139
5.34.4
200,920,920,568
194,073,520,0459,088,206,4324,016,671,775(6,257,477,684)
148,865,799,485
143,403,792,1192,317,434,7504,401,062,376(1,256,489,760)
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V Other short-term assets
1 Short-term prepaid expenses
2 VAT deducted
3 Other short-term asset
150
151152158
5.5
5.6
13,538,936,243
3,569,235,0623,006,508,8266,963,192,355
6,398,676,813
1.663.871.4491,476,763,4213,258,041,943
186,379,478,808
98,367,745,001155,373,011,712(57,005,266,711)21,899,901,79422,039,345,412(139,443,618) 66,111,832,013
II Long-term financial investment
1 Investment in associated company, joint venture
4.6, 5.104.6, 5.114.6, 5.12
78,213,960,000
73,570,200,0004,643,760,000-
78,158,000,000
69,000,000,00010,208,000,000(1,050,000,000)
III Other long-term asset
1 Long-term prepaid expenses
1 Short-term loan and debt
2 Payables for seller
3 Deposit
4 Taxes and payables for the state
5 Payables for labor
6.Other short-term payables and receivables
310311312313314315319
5.14
5.155.16
192,916,685,483
70,819,739,361 72,396,892,281 8,783,936,312 19,083,402,707 16,885,274,946 4,947,439,876
135,460,967,942
33,720,226,995 65,310,106,908 14,120,070,708 9,272,558,518 9,685,308,104 3,352,696,709
II Long-term debt
1 Other long-term payables
Trang 44 Investment and development funds
5 Provision for financing
6 Retained earnings
410
411412414417418420
5.19 497,252,696,252
178,093,360,000 229,275,000,000 (15,737,386,.415) 33,053,413,153 10,560,423.609 62,007,885,905
471,091,959,890
137,699,990,000229,275,000,000(10,925,191,085)59,962,318,0207,557,455,32047,522,387,635
II Other expenses and funds
Reward fund and welfare 430431 5.20 4,651,711,172 4,651,711,172 4,736,000,8544,736,000,854
General Director Huynh Trung Chanh
Chief Accountant Pham Ngoc Tuyen
REPORT OF BUSINESS PERFORMANCE
On December 31st, 2010 Price unit: VND
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1 Sale revenue and service supply 01 4.11, 6.1 1,071,895,125,105 941,224,745,266
3 Net revenue from goods and service 10 6.3 1,067,897,302,992 937,760,612,893
4 Original price of goods sold and service 11 6.4 750,295,758,943 677,519,918,845
6 Revenue from financial activities
4.11, 6.54.12, 6.64.76.76.8
7,410,029,1396,714,971,3455,153,557,779120,152,210,21593,890,709,242
9,839,072,77527,629,845,4484,909,839,18992,538,541,72175,631,093,830
11 Other income
12 Other expense
31332
6.96.10
12,973,462,8645,039,081,288
235,763,86821,948,932
4.13, 6.11 35,825,597,903
-11,688,745,821
General Director Huynh Trung Chanh
Chief Accountant Pham Ngoc Tuyen
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CASH FLOW STATEMENT
On December 31st, 2010 Price unit : VND
Adjustment for items
Depreciation of fixed asset
Provisions
Unrealized (interest)/loss of exchange rate difference
(interest)/loss from investment activities
Cost of interest
Profit from business operation before change
Floating capital
(increase)/decrease receivables
Increase )/decrease inventory
Increase /decrease) payables
Increase )/decrease prepaid expenses
Interest paid on loan
Business tax paid
Other receivables from business operation
Other receivables from business operation
Net cash flow from business operation
Net cash flow from investment activities
Payables for purchase, build fixed asset and other long-term
asset
Receivables from liquidation, sale of fixed assets and other
long-term asset
Cash for borrow, purchase of debt instruments of other entities
Proceeds from loans, sale of debt instruments of other entities
Payments for investment, capital contribution to other entities
Proceeds from loans, dividends and divided profits
Net Cash flow from investment activities
Cash flow from financial activities
Payments for capital contribution for owners, acquisition of
released business share
Short-term, long-term loans receivable
Payments for the original loan
Dividend, profit payable for owners
Net cash flow from financial
Net cash flow in term
Cash and cash equivalents in beginning of the term
The influence of the change of exchange rates for foreign
currency exchange
Cash and cash equivalents at the end of the term
01
0203040506
08
0910111213141516
20
212223242527
30
32333436
40
50606170
112,188,063,962
18,054,891,706(2,168,168,076)569,969,388(7,019,180,251)5,153,557,779
126,779,134,508
(62,291,004,824)(14,823,897,882)(950,473,465)(3,196,731,043)(5,097,695,767)(25,095,660,054)2,613,460,864(12,439,696,241)
5,497,436,096
(54,917,211,311)12,818,681,818(295,860,000)11,919,147,100(4,570,200,000)3,509,886,275
(31,535,556,118)
(4,812,195,330)193,531,731,169(144,891,117,103)(27,034,458,000)
16,793,960,736
(9,244,159,286)32,635,944,465569,969,38822,821,815,791
74,494,100,706
15,729,744,5376,221,127,406(68,176,168)5,513,125,3774,909,839,189
106,799,761,047
(21,910,037,908)60,205,540,001(43,530,715,255)(302,865,195)(4,909,839,189)(6,047,866,901)1,735,342,500(13,246,978,420)
78.792.340.680
(68,930,412,927)13,890,909(15,667,725,402)10,998,123,100(60,000,000,000)2,809,320,961
(130,776,803,359)
(10,925,191,085)92,357,545,565(61,472,902,565)(27,407,198,000)
(7,447,746,085)
(59,432,208,764)91,999,977,06168,176,16832,635,944,465
General Director Huynh Trung Chanh
Chief Accountant Pham Ngoc Tuyen
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I Financial statement analysis:
In general meaning, financial statement analysis mentions the art of analysis and the explanation of financial statements It applies tool and analytical technique
to financial statements and relevant documents in order to draw useful estimations and conclusions for business decisions It is a selective tool to chose “candidates” for investment or merger It is also a tool to foresee conditions and consequences of the finance in the future
Financial statement analysis is a diagnostic device when it assesses operations of investment, finance and business It is used to evaluate management and other business decision .
Financial statement analysis is not only a calculation process of numbers but also a process of review, examination, collation and comparison of current financial result of the company between the present with the past in order to evaluate the financial situation of the company, what the company have done exactly, and obtain the potentials, expect what things will happen and then suggest methods in order to take full advantage of the strength and overcome the weakness
On the other hand, it is necessary for financial statement analysis to make above these data can “speak” in order for users to understand clearly financial situation of the business and the objective, plan of managers of such businesses
The purpose of financial statement analysis is to provide the useful information for investors, creditors and other users to make their own decisions about investment, credit and similar decision The information needs to be easy to understand for those who want to research these information but they have relative level on business and economic activities At the same time it helps investors, creditors and other users assess the quantity, time and risk of receivables from dividend or cash
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II Analysis of account balance of DOMESCO company
Every year, most of people come to the doctor to check their overall health - a physical conditioncheck-up at a certain time Similarly, balance sheet of accounting is an integrated financial situation of
the companies at a certain time, usually the end of the month, quarter or ending of fiscal year
In fact, the balance sheet shows the assets are managed by the company and providing funds forthese assets - by using capital of those who granting loans (liabilities), capital contributed from owners,
or from both sources The balance sheet is reflected in the two following accounting equation: Assets =
Cash and relevant amounts 110 22,821,815,791 32,635,944,465 -9,814,128,674 -0.301 Amounts for short term financial
investment
-Short term receivable accounts 130 200,920,920,568 148,865,799,485 52,055,121,083 0.350
Short term liability 310 192,916,685,483 135,460,967,942 57,455,717,541 0.424
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The assets : Current assets in 2010 increased 17.4% of VND 59,993,355,721 respectively compared to
original year 2009 is 100% Cash and amounts similar to cash decreased 30.1% compared with originalyear 2009 Meanwhile, short term accounts receivable increased 35% in 2010, inventories increased 9.7%
in 2010; other short term assets also increased 111.6% compared to original year 2010 is 100% It showsthat the main field of the company is production and trade
Fixed assets increased by 19.1% in 2010, equivalent to VND 35,690,577,168 compared to original year
2009 is 100% Long-term financial investment barely increased, just increased 0.1% in 2010 and other long term assets increased 34.9% in 2010 compared to original year 2009 is 100% This demonstrates thatthe company is interested in expanding business activities to strengthen competition in the marketplace.The capital source : In 2010, liabilities increased 51.8% , equivalent to VND 70,964,547,639 compared tooriginal year 2009 of 100% because short-term and long-term liabilities all increased It shows thatthe company increased business scale by using short-term funds Owner’s capital increased 5.5%equivalent to VND 26,076,446,680 in 2010 compared to original year 2009 is 100% This provesbusiness result is effective
II Analysis of table of business activities report of DOMESCO company:
The report of business results, also known as interests/ loss report reflects the status and results
of business activities as well as the implementation of responsibilities and obligations of the enterprisestoward the State in an accounting period
Through the targets of report of business results, we can check, analyze and evaluate the status
of implementation of the plan, estimate the cost of production, cost price, product sales, materialconsumption, situation of cost and income of other activities and business results after an accountingperiod
Through data of report of business result, we can check the status of implementation of responsibilities and obligations of the enterprises toward the State and other taxes and other payables
Through the report of results of business operations, we can assess the trend of enterprisedevelopment in the future
Analysis of figures of report of business result
Using 01/01/ 2010 (2009) as original basis to compare, analyze finance of 2009 and 2010.
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Based on above analysis table, the business situation of DOMESCO company has profit aftertax of VND 76,362,466,059 ,increasing 21.59% compared to original year 2009 This is a good sign
shows that company works rather highly effectively
III Analysis of table of flow of cash of DOMESCO company
Based on current accounting regime, the cash flow statements is not mandatory financial report
It is only guidelines Thus the state should soon force the enterprises to make report of cash flow
when presenting the financial information to the subjetcs for the following reasons:
Currently, investors, lenders, suppliers, managers, etc including the State concern about thefinancial situation of the business and events, the economic transactions that affect financial status of the
e
1 Revenue of sales and service supplement 01 1,071,895,125,105 941,224,745,266 130,670,379,839 0.1381
3 Net revenue from goods and services 10 1,067,897,302,992 937,760,612,893 130,136,690,099 0.1387
4 Cost price for goods and services 11 750,295,758,943 677,519,918,845 72,775,840,098 0.1074
5 Total profit from sales and service supplement 20 317,601,544,049 260,240,693,994 57,360,850,055 0.2204
6 Revenue from financial activities
7,410,029,1396,714,971,3455,153,557,779120,152,210,21593,890,709,242
9,839,072,77527,629,845,4484,909,839,18992,538,541,72175,631,093,830
-2,429,043,636-20,914,874,103243,718,59027,613,668,49418,259,615,412
-0.2469-0.75700.04960.29840.2414
10 Net profit from business activities 30 104,253,682,386 74,280,285,770 29,973,396,616 0.4035
11 Other income
12 Other costs
31332
12,973,462,8645,039,081,288
235,763,86821,948,932
12,737,698,9965,017,132,356
54,0273228,2077
14 Total accounting profit before tax 50 112,188,063,962 74,494,100,706 37,693,963,256 0.5060
15 Expense of current enterprise income tax
16 expense of deferred enterprise income tax
5152
17 Profit after enterprise income tax 60 76,362,466,059 62,805,354,885 13,557,111,174 0.2159
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enterprises Investors and managers want to know if the enterprises have enough cash to meet thebusiness opportunity or not, potentially dominant in the new business opportunities arise or not? Lenderswant to know whether the business can repay the loan on time or not?
Therefore, financial information of business can help the enterprises make their economicdecisions To meet that requirement, enterprises must prepare a financial report with integrated- specificcontent about money flow into the business as well as the money flow out of its in an certainaccounting period
Analysis of figures of table of money flow
Using 01/01/ 2010 ( 2009) as original basis to compare , analyze finance of 2009 and 2010.
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I Flow of money from business activities
Profit before tax
Adjustment for accounts
Depreciation of fixed assets
Provision amounts
(Interests)/loss difference of exchange rate has not
implemented
(Profit)/loss from investment activity
Cost of loan interest
Profit from business activity before change
Floating capital
(Increase)/ decrease in accounts receivable
Increase)/ decrease in inventory
Increase)/ decrease in accounts payable các khoản phải
trả
Increase)/ decrease in cost paid in advance
Loan interest had been paid
Enterprise income tax has been paid
Other income from business activity
Other income from business activity
Flow of net amount from business activity
II Flow of money from investment activity
01
0203040506
08
0910111213141516
20
212223
112,188,063,962
18,054,891,706(2,168,168,076)569,969,388(7,019,180,251)5,153,557,779
126,779,134,508
(62,291,004,824)(14,823,897,882)(950,473,465)(3,196,731,043)(5,097,695,767)(25,095,660,054)2,613,460,864(12,439,696,241)
5,497,436,096
(54,917,211,311)12,818,681,818(295,860,000)
74,494,100,706
15,729,744,5376,221,127,406(68,176,168)5,513,125,3774,909,839,189
106,799,761,047
(21,910,037,908)60,205,540,001(43,530,715,255)(302,865,195)(4,909,839,189)(6,047,866,901)1,735,342,500(13,246,978,420)
78.792.340.680
(68,930,412,927)13,890,909(15,667,725,402)
37,693,963,256
2,325,147,169-4,052,959,330501,793,2201,506,054,874243,718,590
19,979,373,461
40,380,966,916-45,381,642,119-42,580,241,7902,893,865,848187,856,57819,047,793,153878,118,364-807,282,179
-73,294,904,584
-14,013,201,61612,804,790,909-15,371,865,402
0.5060
0.1478-0.65157,36040.27320.0496
0.1871
1,8430-0.75380.97819,55500.03833,14950.50600.0609
-0.9302
-0.2033921,8109-0.9811