The financial statements of Hudson’s Bay Company for its year ended February 3, 2018 (fiscal 2017) appear at the end of this book.

Instructions

a. What alternative formats could the company have used for its balance sheet? Which format did it adopt?

b. Identify the various techniques of disclosure that the company could have used to present additional financial information that is pertinent. Which techniques does it use in its financial statements?

c. Why does Hudson’s Bay Company not have the same year-end date in 2017 as it did in 2016? (Hudson’s Bay considers the year ended February 3, 2018, to be fiscal 2017 and the year ended January 28, 2017, to be fiscal 2016.) What is the length of the reporting period in 2017, as opposed to 2016? Why does the company have a reporting period that is not the same length for each of the two years? Is there any impact on the difference in length of reporting period in terms of comparability?

d. Which presentation method does the company use for its statement of cash flows (direct or indirect method)? What were the company’s cash flows from its operating, investing, and financing activities for the year ended February 3, 2018? What was the change in net cash provided by operating activities over the year ended February 3, 2018? Is the cash generated from operating activities significantly different from net losses in both fiscal 2016 and 2017? Suggest why this might happen.

e. Calculate the company’s (1) current cash debt coverage ratio, (2) cash debt coverage ratio, and (3) free cash flow for fiscal 2016 and 2017. What do these ratios indicate about the company’s financial condition?