As a team, select an industry to analyze. A list of companies classified by industry can be obtained by accessing www.fpinfomart.ca and then choosing "Companies by Industry." You can also find a list of industries and companies within each industry via http://ca.finance.yahoo.com/investing (click on "Annual Reports" under "Tools"). Using a Web browser, each team member should acquire the annual report for one publicly traded company in the industry, with each member selecting a different company.

Required:

On an individual basis, each team member should write a short report answering the following questions about the selected company. Discuss any patterns across the companies that you as a team observe. Then, as a group, write a short report comparing and contrasting your companies.

1. If your company lists receivables on its statement of financial position, what percentage is this asset of total assets for each of the last three years? If your company does not list receivables, discuss why this is so.

2. Ratio analysis:

a. What does the trade receivables turnover ratio measure in general?

b. If your company lists receivables, compute the ratio for the last three years.

c. What do your results suggest about the company?

d. If available, find the industry ratio for the most recent year, compare it to your results, and discuss why you believe your company differs from or is similar to the industry ratio.

3. If your company lists receivables, determine what additional disclosure is available concerning the allowance for doubtful accounts. If the necessary information is provided, what is bad debt expense as a percentage of sales for the last three years?

4. What is the effect of the change in trade receivables on cash flows from operations for the most recent year-that is, did the change increase or decrease operating cash flows? Explain your answer.