Four years ago, Belindas company implemented a new program that focused on corporate social responsibility. Several strategies were included in the program to improve community relations as well as foster an environment that would lead to greater employee satisfaction. Some of the new strategies were implemented at significant cost, but the company estimated that the program would result in improved employee relations, greater productivity and favorable views from the public eye. Overall, the changes were expected to provide a good return on investment within four to five years time. Now, Belinda has been asked to do a horizontal and vertical analysis and use her findings to write an impact statement for the new program.

In one to two paragraphs, address the following:

• Describe the steps Belinda will use to perform horizontal analysis and vertical analysis.
• Identify the financial statements Belinda will use to perform horizontal analysis and vertical analysis.
• Explain how the findings from horizontal and vertical analysis can be used to help Belinda with her report.