This section may talk about the functions of production, marketing, or research and development, to name just a few. In many cases, several of these areas may be highlighted. Encourage your students to analyze this information in the context of what they think the focus of the company should be. Remember, always encourage analysis with a skeptical eye. The Annual Reports used in the classroom should be from companies that have this audit requirement.
Unaudited statements are common, but can raise many more questions than they answer.
In addition to the common statements of income and balance sheet, the students will encounter statements of sources and uses and many other financial schedules that give insight into the companies operations. Students should be required to do some type of analysis of these statements. I require the completion and analysis of ten common ratios and then an overall analysis of the company s health. The financial statement analysis section ends with a recommendation from the group concerning purchase of the company s stock. Familiarity with Top Management Annual Reports also give the student an introduction to top management of the company.