Question 1: Discuss the accounting cycle. Which steps in the cycle do you consider to be the most important? Question 2: In addition to trend analysis, analysts frequently incorporate external (non-financial) information into the prospective process to project future performance. Some examples are the expected level of macroeconomic activity, the degree to which the competitive landscape is changing, any strategic initiatives that have been announced by management, and so forth.

Where do you think this projection process would start? What can affect this starting point? How does this starting point impact the balance sheet?