Question

This results need to be in paragraph form.

Perform a vertical and horizontal analysis of Wal-Mart Stores, Inc.’s income statements and balance sheets as of January 31, 2015. In performing this analysis, consider any notable trends or changes that you observe that may provide useful information concerning its financial condition. Also use as many years’ worth of statements as you feel necessary.

A B E Statement of Cash Flows |(Amounts in millions) Fiscal Year Ended January 31, Cash flows from operating activities: 9 2015 2014 2013 2012 Consolidated net income 10 (Income) Loss from discontinued operations, net of tax 11 $17,099 (285) $16,695 (144) $17,756 (52) $16,387 21 12 Income from continuing operations 13 16,814 16,551 17,704 16,408 14 Adjustments to reconcile income from continuing operations to net cash provided by operating activities 15 Depreciation and amortization 16 Deferred income taxes 17 Other operating activities 18 9,173 8,870 8,478 8,106 1,050 468 (503) 785 (279) 938 (133) 602 19 Changes in certain assets and liabilities, net of effects of acquisitions: 20 Increase in accounts receivable 21 Increase in inventories 22 Increase in accounts payable 23 (569) (1,229) 2,678 1,249 (566) (1,667) (614) (2,759) 1,061 (796) (3,727) 2,687 531 Increase in accrued liabilities 24 (Decrease) Increase in accrued income taxes 25 103 271 30 166 (1,224) 981 29 26 Net cash provided by operating activities 27 28 Cash flows from investing activities: 29 Payments for property and equipment 30 Proceeds from disposal of property and equipment 31 Proceeds from disposal of certain operations 32 Other investing activities 33 34 Net cash used in investing activities 35 28,564 23,257 25,591 24,255 (12,898) 532 (12,174) 570 (13,115) 727 (13,510) 580 671 0 0 (3,679) (192) (138) (271) (12,637) (11,125) (12,526) (16,609) 36 Cash flows from financing activities: 37 Net change in short-term borrowings 38 Proceeds from issuance of long-term debt 39 Payment of long-term debt 40 Dividends paid 41 Purchase of Company stock 42 Dividends paid to noncontrolling interest 43 Purchase of noncontrolling interest 44 Other financing activities 45 (6,288) 5,174 911 2,754 3,019 5,050 (4,584) (5,048) (6,298) (526) 7,072 (4,968) (6,139) (6,683) (426) (296) (260) 211 (3,904) (6,185) (1,015) (600) (1,844) (409) (1,478) (5,361) (7,600) (282) (132) (58) (71) 46 Net cash used in financing activities 47 (15,071) (10,789) (11,946) (8,458) 48 Effect of exchange rates on cash 49 (514) (442) 223 (33) 50 Net (decrease) increase in cash and cash equivalents 51 Cash and cash equivalents at beginning of year 52 1,854 7,281 (500) 7,781 1,231 6,550 (845) 7,395 53 Cash and cash equivalents at end of year 54 $6,550 $9,135 $7.281 $7,781 IS RS SCE M456

Answer 1

HCL Chegg Mic Review View Data Page Layout Formulas Insert Home E AutoSum Cut Wrap Text General 11 Calibri Fill a Copy Insert Delete Format Format Ceil Stvles S 2Clear Merge & Center IU Paste s Table 86 % Formatting Fomat Painter Cells Number Styles Alignment Font Clipbosrd There is a scope of improvement in Financing and Investing Activiites of the company. 836 M K F G A 1 POINTS TO BE NOTED:- 2 HORIZONTALANALYSIS 4 As compared to year 2012 the revenue in year 2013 has increased and then reduced in year 2014 and again increased in year 2015. The above incomes for respective years 5 after accounting for Profit/Loss from discontinuing operations. These are operations which have one time effect on revenue. 6 Hence while calculating profit from operating activities, such profit/loss needs While analysing revenue from continuing operations, we can see income is highest in year 2013 and reduced correspondingly. Depreciation has been increasing every year from 2012 onwards which leads us to conclusion that campany has been spending on purchasing fixed assets. Cash flows from operating activiites are shown after adjusting increase/ decrease from Balance Sheet items. Cash flows after such adjustment leads us to conclusion that chas flows from operating activities were highest in year 2015 and lowest in year 2014. So the cash flows are on positive side and increasing which is a good sign as company is earning from its principal activities 7 o be removed to arrive proper value. 10 11 12 As concluded cash flows are negative in investing activities as company has been spending on purchase of Fixed Assets as disclosed above. Company has also been active in disposing of its fixed assets agrnd 13 14 equi every year. 15 Year 2013 5 also has income from disposal of certain operations which is again a rare cash flow item. n borrowings had a positive balance in each year from 2012 to 2014 and were paid off in year 2015 al of borrowings of 6684 (adding 3019+2754+911) were taken and paid back by 6288 in year 2015. mpany has been active in issuing long term borrowings which can be seen from inflows every year from 2012 to 2015. us to conclusion that company has high debt and therefore high interest outflow which can be dangerous in case of unfavourable DEBT SERVICE COVERAGE RATIO. can also see that company has paid its long term debts every year along with dividend paid every year. Con 16 17 Short Total 18 Com 19 This 20 But we 21 thus we can ronrlud sorting to purchasing company stocks which is buyback of its own shares. 22 that currently company is in cash rich position. 23 Minority Shareholders Finally total cash balannebo y ROLLING INTEREST have also been bought which leads us to believe that shareholders want to gain complete control of business, 24 ben on rise which is ultimately a good sign fro company as a whole. 25 AOK As 1Ans 2 Fnter

Chegg Mtoso Formulas Review View Data insest Page Layout Home Ar a cut E Autosum Wrap Text Calibri General Copy Fit- Merge & Center Sort & Find a Filter Select Editing ste J Format Painter BIU Insert Delete Format S% Len Formatting as Tatule Stules Clear CHbcard Font Alignment Cells Number Styles 023 D G K N C VERTICAL ANALYSIS vertical analysis of any year will lead us to conclusion that cash flows are positive from operating activities and negative from investing and financing activities The ultimate cash balance has always been positive which is a good sign and company has been working excellent. No non-controlling interest was purchase by the company in year 2012 which leads us to believe that after 2012 the business was on a rise and company thought of buying shares to gain control. Year 2012 and 2014 saw negative hal m long term borrowings which shows company had enough to meet needs of both long and short term demands. Negative balance means company no or year but closing balance positive. Even in year 2015 company has no not earn cash during the year and opening cash balance have reduced which is not a good sign. proceedu year 2013 saw lowest amount 1 33 nce of 1854 million $ out of which 671 million $ are from disposal of certain business opeartions we can conclude that company hac n flows would have further reduced. There is a scope of improvement in Financing and Investing Activiites of the company. 4 Had such disposal not been done the 35 active in its operations and cash flows have always been positive but has not invested diligently./ 36 37 38 39 40 41 42 43 44 45 46 47 Ans1 Ans 2 As 3 Resdy 454 PM