Question:

Review all the financial data carefully, then perform the following tasks:

a. Discuss the findings from your ratio analysis both within StilSim and compared to the competitor. Include the charts fromFinancial Performance Analysisto help you identify problem areas and trends that are good ortroublesome.

b. Use those charts to compare the differences in ratios between StilSim and the competitor. The target audience will be Bill Simmons and other employees at StilSim. This assignment constitutes a part of your strategic plan.

c. In your Strategic plan, describe the purpose on the Financial Performance Interpretation in the introductory paragraph. Why is this important to StilSim's strategic plan? What is ratio analysis? What are the key areas you are going to analyze? Then address the following:

Short-Term Liquidity

Give a short overview of short-term liquidity ratios. What do they measure and why it is important?

a. Short-term ratio.Compare Current Ratio and Cash Ratio (text page 495 & 496). What does each ratio measure? How is StilSim performing versus the competition?

Insert a chart or graph showing the data for both StilSim and the competitor. It is said that a picture is worth 1,000 words. With financial analysis, a graph is much easier to comprehend than a long narrative description. Normally a bar graph or a line graph works best for this data. Choose the strongest format and title the graph.

i.Strength or Weakness.Is this area of StilSim's financials a strength or weakness (or possibly neutral)? What are the implications of your findings to StilSim's future viability and future strategic plan?

Long-Term Solvency

Give a short overview of long-term solvency ratios (text pg 496 & 497). What do they measure and why it is important?

b.Long-term ratio.Compare Total Debt Ratio and Cash Coverage Ratio. What does each ratio measure? How is StilSim performing versus the competition?

Insert a chart or graph showing the data for both StilSim and the competitor.

i.Strength or Weakness.Is this area of StilSim's financials a strength or weakness (or possibly neutral)? What are the implications of your findings to StilSim's future viability and future strategic plan?

Asset Management

Give a short overview of asset management ratios (text pg 497 & 498). What do they measure and why it is important?

c.Asset management ratio.Compare Receivables Turnover and Days in Receivables Ratios What do these ratios measure? How is StilSim performing versus the competition?

Insert a chart or graph showing the data for both StilSim and the competitor.

i.Strength or Weakness.Is this area of StilSim's financials a strength or weakness (or possibly neutral)? What are the implications of your findings to StilSim's future viability and future strategic plan?

Compare Dividend Payout vs Retained Earnings for StilSim and competitor.

Strength or Weaknessfor StilSim? What are the future implications for StilSim if dividend policy changes are not made?

Profitability Measures

Give a short overview of profitability measures (text pg 498-500). What do they measure and why it is important?

d.Profitability measure.Start with a Profit Margin trend comparison between StilSim and competitor. What does it measure? How is StilSim performing versus the competition?

Insert a chart or graph showing the data for both StilSim and the competitor.

i.Strength or Weakness.Is this area of StilSim's financials a strength or weakness (or possibly neutral)? What are the implications of your findings to StilSim's future viability and future strategic plan?

e.ROE & ROA Compare ROE/ROA between StilSim and the competitor.

f.Branch profitability.How are StilSim's various branches performing relative to each other?

Insert a chart or graph showing the data for StilSim's branch productivity.

i.Implications.What are the possible implications of your findings to StilSim future viability and future strategic plan?

a. Which short-term issues will require attention before long-term strategies might be considered? Where does StilSim have a competitive advantage? Disadvantage?

StilSim Personnel - Consolidated Financials 6/25/16 2011 StilSim 2012 StilSim 2013 StilSim 2014 StilSim 2015 StilSim 2016 estimate 2011 StaffAces 2012 StaffAces 2013 StaffAces 2014 StaffAces 2015 StaffAces Income Statement Revenue Permenant Placement Revenue Temporary Placement Revenue Direct labor expense Net revenue 1,930,425 3,090,221 2,916,957 3,485,488 3,165,996 3,136,726 0 0 0 0 0 0 0 0 0 1,168,369 719,877 448,492 918,138 556,967 361,171 790,818 467,757 323,061 Revenue - other 0 0 0 0 0 0 Total Revenue 1,930,425 3,090,221 2,916,957 3,933,980 3,527,167 3,459,787 10,184,180 11,493,670 13,160,130 13,895,000 16,689,290 Expenses Salary Bonus Burden 694,008 1,034,934 1,067,018 1,464,694 1,511,565 1,564,471 166,435 290,099 273,509 353,521 318,405 312,564 274,133 408,797 421,471 578,552 597,065 617,965 Wages & burden 1,134,576 1,733,830 1,761,998 2,396,767 2,427,035 2,495,000 Rent 58,800 93,700 93,700 138,900 138,900 138,900 Utilities 25,832 47,078 48,537 73,221 75,564 78,210 Accounting services 5,095 8,370 8,630 12,266 12,658 13,087 Advertising 22,206 31,330 27,339 35,962 31,381 27,870 Travel & entertainment 59,472 115,829 117,902 178,511 184,183 190,112 Supplies & equipment 21,884 37,576 38,727 52,860 54,535 55,866 Postage & express 25,964 41,804 43,043 59,040 60,853 60,480 Training & development 380 430 2,346 2,308 2,393 2,520 Memberships 1,940 2,310 2,380 2,920 3,010 3,100 Insurance 71,545 119,271 122,865 165,268 170,418 171,866 Miscellaneous 5,696 12,481 6,801 12,244 8,216 8,396 Interest 13,821 20,842 20,182 44,184 43,844 43,564 Depreciation & amort 4,749 24,098 26,161 41,620 38,289 38,818 Total Expense 1,451,960 2,288,949 2,320,611 3,216,071 3,251,279 3,327,789 Income before tax Taxes 06/25/2016 17:16:13 478,465 191,587 801,272 320,845 596,346 238,788 717,909 287,465 275,888 110,470 131,998 52,853 2,622,000 3,004,590 3,622,480 14,910 15,150 12,070 11,300 170,300 164,700 163,800 189,000 10,042,770 11,202,050 12,666,890 13,348,900 12,480 204,720 16,079,920 141,410 53,440 2,588,000 291,620 93,230 2,828,280 493,240 185,330 546,100 209,800 609,370 160,130 1 StilSim Personnel - Consolidated Financials 6/25/16 2011 StilSim Net Income 286,878 2012 StilSim 480,427 2013 StilSim 357,558 2014 StilSim 430,444 2015 StilSim 165,418 2016 estimate 79,145 2011 StaffAces 87,970 2012 StaffAces 198,390 2013 StaffAces 307,910 2014 StaffAces 336,300 2015 StaffAces 449,240 Cash & S/T investments 1,649,072 1,672,276 1,875,691 1,816,561 2,044,504 1,894,497 Accounts receivable 634,337 1,090,415 1,062,599 1,377,484 1,103,509 1,136,886 Total current 2,283,409 2,762,691 2,938,290 3,194,045 3,148,013 3,031,383 1,243,770 1,052,400 2,296,170 1,631,530 1,086,900 2,718,430 1,093,110 1,538,700 2,631,810 1,295,130 1,672,900 2,968,030 1,220,030 1,995,100 3,215,130 5,181,290 5,464,660 5,607,690 6,017,430 7,194,610 Balance Sheet Assets Furniture 20,984 Leasehold improvements 109,228 Computers & copiers 15,218 less depreciation (137,837) 7,593 Goodwill 32,110 180,833 26,919 (161,935) 77,927 34,784 192,970 29,342 (188,096) 69,000 51,755 231,000 44,581 (229,716) 97,620 51,755 231,000 48,241 (268,005) 62,991 53,792 231,000 53,048 (306,823) 31,017 0 0 0 762,976 762,976 762,976 Total Assets 2,291,002 2,840,617 3,007,289 4,054,641 3,973,979 3,825,376 Liabilities Accounts payable 104,242 Short-term debt 75,000 Total current 179,242 166,871 100,000 266,871 157,515 100,000 257,515 212,434 200,000 412,434 190,466 200,000 390,466 186,828 200,000 386,828 180,290 187,760 258,620 272,920 298,500 848,350 859,230 1,122,890 1,135,560 1,214,090 Long-term debt 105,000 Total Liabilities 284,242 210,000 476,871 210,000 467,515 510,000 922,434 510,000 900,466 510,000 896,828 0 2,326,970 0 2,337,590 0 2,671,900 0 2,681,000 296,560 3,261,010 2,831,560 2,854,320 3,098,000 3,127,070 2,909,350 2,935,790 3,309,000 3,337,000 3,913,260 3,933,600 Equity Common stock, $1 par Capital surplus Retained earnings Total Equity 726,120 726,120 726,120 896,445 896,445 896,445 871,344 871,344 871,344 1,131,940 1,131,940 1,131,940 409,296 766,282 942,310 1,103,822 1,045,128 900,163 2,006,760 2,363,746 2,539,774 3,132,207 3,073,513 2,928,548 Total Liabilities & Equity 2,291,002 2,840,617 3,007,289 4,054,641 3,973,979 3,825,376 Dividends $ per share 06/25/2016 17:16:13 0.14 0.17 0.25 0.30 0.25 0.25 2 StilSim Personnel - Consolidated Financials 6/25/16 2011 StilSim 101,656 0 2012 StilSim 123,440 0 2013 StilSim 181,530 0 2014 StilSim 268,933 0 2015 StilSim 224,111 0 2016 estimate 224,111 0 286,878 4,749 (1,014) 0 0 0 Total 290,613 480,427 24,098 62,629 25,000 105,000 0 697,154 357,558 26,161 (9,356) 0 0 0 374,363 430,444 41,620 54,919 100,000 300,000 430,921 1,357,904 165,418 38,289 (21,968) 0 0 0 181,739 79,145 38,818 (3,638) 0 0 0 114,325 23,204 456,078 11,126 71,605 11,701 0 123,440 697,154 203,415 (27,816) 2,674 12,137 2,423 0 181,530 374,363 (59,130) 314,885 16,971 38,030 15,239 762,976 268,933 1,357,904 227,943 (273,975) 0 0 3,660 0 224,111 181,739 (150,007) 33,377 2,037 0 4,807 0 224,111 114,325 0 0 0 0 0 277,898 197,218 0 251,004 726,120 277,898 197,218 0 251,004 726,120 277,898 197,218 170,325 251,004 896,445 277,898 197,218 170,325 251,004 896,445 277,898 197,218 170,325 251,004 896,445 Dividends $ Balance - check sum 2011 StaffAces 0 2012 StaffAces 0 2013 StaffAces 0 2014 StaffAces 0 430,140 435,400 423,220 398,620 2015 StaffAces 0 Sources of Funds Net income Depreciation Accounts payable Short-term debt, net Long-term debt, net Equity Uses of Funds Cash, net 88,413 Accounts receivable 94,771 Furniture 1,951 Leasehold improvements 0 Computers & copiers 3,822 Other assets 0 Dividends 101,656 Total 290,613 Sources - check sum 0 Stockholders, shares Bill Simmons Stillman Trust Ebenezer Investments Publicly traded Shares outstanding 06/25/2016 17:16:13 277,898 197,218 0 251,004 726,120 405,020 3 StilSim Personnel - Consolidated Financials 6/25/16 2011 StilSim 2012 StilSim 2013 StilSim 2014 StilSim 2015 StilSim 2016 estimate 2011 StaffAces 2012 StaffAces 2013 StaffAces 2014 StaffAces 2015 StaffAces 10.4 6.3 11.4 7.3 7.7 4.4 8.1 5.2 7.8 4.9 2.7 1.5 3.2 1.9 2.3 1.0 2.6 1.1 2.6 1.0 0.12 0.14 1.14 35.6 36.0 0.17 0.20 1.20 39.4 40.6 0.16 0.18 1.18 30.5 31.8 0.23 0.29 1.29 17.2 18.2 0.23 0.29 1.29 7.3 8.2 0.23 0.31 1.31 4.0 4.9 0.45 0.82 1.82 10.5 21.9 0.43 0.75 1.75 20.2 31.1 0.48 0.91 1.91 41.9 55.4 0.45 0.80 1.80 49.3 66.1 0.45 0.83 1.83 49.8 66.2 3.0 120 0.84 1.19 65% 35% 2.8 129 1.09 0.92 74% 26% 2.7 133 0.97 1.03 49% 51% 2.9 128 0.97 1.03 38% 62% 3.2 114 0.89 1.13 -35% 135% 3.0 120 0.90 1.11 -183% 283% 9.7 38 1.97 0.51 100% 0% 10.6 35 2.10 0.48 100% 0% 8.6 43 2.35 0.43 100% 0% 8.3 44 2.31 0.43 100% 0% 8.4 44 2.32 0.43 100% 0% 14.9% 12.5% 14.3% x x x 0.40 15.5% 16.9% 20.3% 60.1% 57.6% 52.8% 0.66 12.3% 11.9% 14.1% -5.6% 1.4% 1.6% 0.49 10.9% 10.6% 13.7% 34.9% 38.6% 36.0% 0.48 4.7% 4.2% 5.4% -10.3% 1.1% 1.3% 0.18 2.3% 2.1% 2.7% -1.9% 2.4% 2.8% 0.09 0.9% 1.7% 3.1% X X X 0.20 1.7% 3.6% 6.3% 12.9% 11.5% -1.3% 0.46 2.3% 5.5% 10.5% 14.5% 13.1% 9.3% 0.73 2.4% 5.6% 10.1% 5.6% 5.4% 6.2% 0.84 2.7% 6.2% 11.4% 20.1% 20.5% 20.6% 1.11 Ratio Analysis Short-term Liquidity Ratios Current ratio Cash ratio 12.7 9.2 Long-term Solvency Ratios Total debt ratio Debt-equity ratio Equity multiplier Times interest earned Cash coverage ratio Asset Utilization Ratios Receivable turnover Days revenue in A/R Total asset turnover Capital intensity Retained earnings, % Dividend payout, % Profitability Ratios Profit margin, % Return on assets (ROA) Return on equity (ROE) Revenue growth, % Expense growth, % Labor expense growth, % Earnings per share, $ StilSim 1.4 Ratio Analysis 12/8/2015 06/25/2016 17:16:13 4 Profit Margins 25.0% 20.0% 15.0% Total 10.0% Cap City 5.0% Lakeside Mountainview 0.0% 2010 -5.0% 2011 2012 2013 2014 2015 2016 2017 -10.0% Revenue Growth 10.0% 5.0% 0.0% -5.0% 2011 2012 2013 2014 2015 2016 Cap City Lakeside -10.0% Mountainview -15.0% -20.0% -25.0% Expense Growth 4.0% 3.5% 3.0% 2.5% Cap City 2.0% Lakeside 1.5% Mountainview 1.0% 0.5% 0.0% 2011 2012 2013 2014 2015 2016 2.5% Cap City 2.0% Lakeside 1.5% Mountainview 1.0% 0.5% 0.0% 2011 -0.5% 2012 2013 2014 2015 2016 Labor Expense Growth 4.0% 3.5% 3.0% 2.5% Cap City 2.0% 1.5% Lakeside 1.0% Mountainview 0.5% 0.0% 2011 -0.5% 2012 2013 2014 2015 2016 -1.0% Current Ratio - StilSim vs. StaffAces 12.0 10.0 Times 8.0 Current Ratio StilSim Current Ratio StaffAces 6.0 4.0 2.0 0.0 2013 2014 2015 Year Cash Ratio - StilSim vs. StaffAces 8.00 7.00 6.00 5.00 Times Cash Ratio StilSim Cash Ratio - StilSim vs. StaffAces 8.00 7.00 6.00 5.00 Times 4.00 Cash Ratio StilSim Cash Ratio StaffAces 3.00 2.00 1.00 0.00 2013 2014 2015 Year Total Debt Ratio 0.6 0.5 0.4 StilSim StaffAces 0.3 0.2 0.1 0 2013 2014 2015 Year Receivable Turnover 10.00 9.00 8.00 7.00 Times6.00 5.00 4.00 3.00 2.00 1.00 0.00 2013 Receivable Turnover StilSim Receivable Turnover StaffAces 2014 Year 2015 4.00 3.00 2.00 1.00 0.00 2013 2014 2015 Year Profit Margin - StilSim vs. StaffAces 14% 12% 10% Percent 8% Profit Margin StilSim Profit Margin StaffAces 6% 4% 2% 0% 2013 2014 Year 2015 Total Cap City Lakeside Mountainview 17 Cap City Lakeside Mountainview Cap City Lakeside Mountainview Cap City Lakeside Mountainview Cap City Lakeside Mountainview Current Ratio StilSim Current Ratio StaffAces Cash Ratio StilSim Cash Ratio StilSim Cash Ratio StaffAces StilSim StaffAces 2015 Receivable Turnover StilSim Receivable Turnover StaffAces Profit Margin StilSim Profit Margin StaffAces StilSim Personnel - Capital City 2011 actual 2012 actual 2013 actual 2014 actual 2015 actual 2016 estimate Income Statement Revenue Permenant Placement Revenue Temporary Placement Revenue Direct labor expense Net revenue 1,930,425 1,911,312 1,820,298 1,582,868 1,493,272 1,571,866 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Revenue - other 0 0 0 0 0 0 Total Revenue 1,930,425 1,911,312 1,820,298 1,582,868 1,493,272 1,571,866 Expenses Salary Bonus Burden 694,008 714,828 736,988 759,098 783,389 810,808 166,435 164,788 156,941 136,470 128,745 135,522 274,133 282,356 291,110 299,843 309,438 320,269 Wages & burden 1,134,576 1,161,972 1,185,039 1,195,411 1,221,572 1,266,599 Rent 58,800 58,800 58,800 62,400 62,400 62,400 Utilities 25,832 26,607 27,432 28,255 29,159 30,180 Accounting services 5,095 5,248 5,411 5,573 5,751 5,946 Advertising 22,206 31,330 27,339 35,962 31,381 27,870 Travel & entertainment 59,472 60,959 62,483 64,046 65,648 67,290 Supplies & equipment 21,884 22,533 23,223 23,912 24,670 25,272 Postage & express 25,964 26,708 27,500 28,290 29,159 28,980 Training & development 380 430 300 190 200 250 Memberships 1,940 2,000 2,060 2,120 2,190 2,250 Insurance 71,545 73,629 75,848 78,061 80,493 81,177 Miscellaneous 5,696 5,864 6,044 6,222 6,419 6,559 Interest 13,821 20,842 20,182 44,184 43,844 43,564 Depreciation 4,749 4,231 5,995 5,857 5,012 4,139 Total Expense 1,451,960 1,501,153 1,527,656 1,580,483 1,607,898 1,652,476 Income before tax Taxes 06/25/2016 17:16:13 478,465 191,587 410,159 164,236 292,642 117,179 2,385 955 (114,626) (45,899) (80,610) (32,278) 13 StilSim Personnel - Capital City Net Income 2011 actual 286,878 2012 actual 245,923 2013 actual 175,463 2014 actual 1,430 20,984 109,228 15,218 (137,837) 7,593 20,984 109,228 16,958 (142,069) 5,101 23,658 121,365 18,484 (148,064) 15,443 23,658 121,365 19,930 (153,921) 11,032 14.9% 1.1% 3.1% 2.8% 12.9% -1.0% 3.4% 2.4% 9.6% -4.8% 1.8% 2.0% 0.1% -13.0% 3.5% 0.9% 2015 actual (68,727) 2016 estimate (48,332) Assets Furniture Leasehold improvements Computers & copiers less depreciation 23,658 24,278 121,365 121,365 21,090 21,642 (158,933) (163,072) 7,180 4,213 Profitability Ratios Profit margin, % Revenue growth, % Expense growth, % Labor expense growth, % 06/25/2016 17:16:13 -4.6% -5.7% 1.7% 2.2% -3.1% 5.3% 2.8% 3.7% 14 StilSim Personnel - Capital City 2011 actual 2012 actual 2013 actual 2014 actual 2015 actual 2016 estimate 3,364 0 2,674 depr sum 2,654 2,448 1,859 2007 206 2008 1,124 1,124 2009 0 0 0 2010 651 651 651 2011 673 673 673 2012 0 0 2013 535 2014 2015 2016 note: this chart will need to be expanded for the forecast period 0 1,859 0 1,208 620 659 Leasehold improvements depr sum (nothing in the prior 5 yr) 2012 2013 2014 2015 2016 0 0 0 Computers & copiers depr sum 2009 2010 2011 2012 2013 2014 2015 2016 1,862 2,096 892 583 621 Depreciation schedule - New additions Furniture 06/25/2016 17:16:13 651 673 0 535 0 673 0 535 0 0 0 535 0 0 124 0 0 0 0 12,137 2,427 0 0 2,427 0 2,427 0 0 2,427 0 0 2,427 0 0 2,427 0 0 0 2,427 1,740 1,784 1,526 1,709 1,446 1,571 1,160 1,377 552 1,053 583 621 580 621 580 509 580 509 482 509 482 387 0 2,427 0 0 0 482 387 184 15 StilSim Personnel - Lakeside 2011 actual 2012 actual 2013 actual 2014 actual 2015 actual 2016 estimate 1,178,909 1,096,659 1,026,834 964,617 935,431 0 0 0 0 0 0 0 0 0 0 0 0 1,178,909 1,096,659 1,026,834 0 964,617 0 935,431 Income Statement Revenue Permenant Placement Revenue Temporary Placement Revenue Direct labor expense Net revenue Revenue - other Total Revenue 0 0 0 0 0 0 Expenses Salary Bonus Burden Wages & burden 320,106 125,311 126,441 571,858 330,030 116,568 130,361 576,959 339,930 109,146 134,272 583,348 350,808 102,533 138,568 591,909 363,087 99,431 143,419 605,937 Rent Utilities Accounting services Advertising Travel & entertainment Supplies & equipment Postage & express Training & development Memberships Insurance Miscellaneous Interest Depreciation Total Expense 34,900 20,471 3,122 0 54,870 15,043 15,096 0 310 45,642 6,617 0 19,867 787,796 34,900 21,105 3,219 0 55,419 15,504 15,543 2,046 320 47,017 757 0 20,166 792,955 34,900 21,739 3,316 0 55,974 15,964 15,990 2,118 330 48,389 779 0 20,449 803,296 34,900 22,434 3,422 0 56,534 16,470 16,481 2,193 340 49,897 804 0 17,356 812,740 34,900 23,220 3,538 0 57,100 16,872 16,380 2,270 350 50,321 822 0 17,601 829,311 Income before tax Taxes 391,113 156,609 303,705 121,609 223,538 89,509 151,877 60,814 106,121 42,492 06/25/2016 17:16:13 16 StilSim Personnel - Lakeside 2011 actual Net Income 2012 actual 234,504 2013 actual 182,096 2014 actual 134,029 2015 actual 91,063 2016 estimate 63,629 11,126 71,605 9,961 (19,867) 72,825 11,126 71,605 10,858 (40,032) 53,557 11,126 71,605 11,708 (60,481) 33,958 11,126 71,605 12,390 (77,837) 17,284 11,418 71,605 13,846 (95,437) 1,432 19.9% 16.6% -7.0% 0.7% 0.9% 13.1% -6.4% 1.3% 1.1% 9.4% -6.1% 1.2% 1.5% 6.8% -3.0% 2.0% 2.4% Assets Furniture Leasehold improvements Computers & copiers less depreciation Profitability Ratios Profit margin, % Revenue growth, % Expense growth, % Labor expense growth, % 06/25/2016 17:16:13 17 StilSim Personnel - Lakeside 2011 actual 2012 actual 2013 actual 2014 actual 2015 actual 2016 estimate 0 2,225 0 2,225 292 2,284 0 2,225 0 0 0 2,225 0 0 0 Depreciation schedule - New additions Furniture 11,126 0 depr sum 0 2,225 2,225 2007 2008 2009 2010 2011 0 0 0 2012 2,225 2,225 2013 0 2014 2015 2016 note: this chart will need to be expanded for the forecast period Leasehold improvements depr sum (nothing in the prior 5 yr) 2012 2013 2014 2015 2016 Computers & copiers depr sum 2009 2010 2011 2012 2013 2014 2015 2016 06/25/2016 17:16:13 0 0 0 0 0 2,225 0 0 0 58 71,605 14,321 0 14,321 0 14,321 0 14,321 0 0 14,321 0 14,321 0 0 0 14,321 0 14,321 0 0 0 0 14,321 9,961 3,320 897 3,619 850 3,903 682 810 1,456 996 0 3,320 0 3,320 299 3,320 299 283 299 283 227 14,321 0 0 0 0 283 227 485 18 StilSim Personnel - Mountainview 2011 actual 2012 actual 2013 actual 2014 actual 2015 actual 2016 estimate Permenant Placement Revenue 875,786 708,107 629,429 Temporary Placement Revenue Direct labor expense Net revenue 1,168,369 719,877 448,492 918,138 556,967 361,171 790,818 467,757 323,061 Revenue - other Total Revenue 0 0 1,324,278 1,069,278 0 952,490 Income Statement Revenue Expenses Salary Bonus Burden Wages & burden 365,666 107,905 144,437 618,008 377,368 87,127 149,059 613,554 390,576 77,611 154,277 622,464 Rent Utilities Accounting services Advertising Travel & entertainment Supplies & equipment Postage & express Training & development Memberships Insurance Miscellaneous Interest Depreciation Total Expense 41,600 23,227 3,377 0 58,491 12,984 14,760 0 470 38,818 5,243 0 15,315 832,293 41,600 23,971 3,485 0 62,001 13,395 15,213 0 480 40,028 993 0 15,921 830,641 41,600 24,810 3,603 0 65,722 13,722 15,120 0 500 40,368 1,015 0 17,079 846,003 Income before tax Taxes 491,985 197,001 238,637 95,555 106,487 42,639 06/25/2016 17:16:13 19 StilSim Personnel - Mountainview 2011 actual Net Income 2012 actual 2013 actual 2014 actual 294,984 2015 actual 143,082 2016 estimate 63,848 16,971 38,030 12,943 (15,315) 52,629 16,971 38,030 14,761 (31,235) 38,527 18,096 38,030 17,560 (48,314) 25,372 22.3% 13.4% -19.3% -0.2% -0.7% 6.7% -10.9% 1.8% 1.5% Assets Furniture Leasehold improvements Computers & copiers less depreciation Profitability Ratios Profit margin, % Revenue growth, % Expense growth, % Labor expense growth, % 06/25/2016 17:16:13 20 StilSim Personnel - Mountainview 2011 actual 2012 actual 2013 actual 2014 actual 2015 actual 2016 estimate 16,971 3,394 0 3,394 1,125 3,619 3,394 3,394 0 3,394 0 225 Depreciation schedule - New additions Furniture depr sum 0 0 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 note: this chart will need to be expanded for the forecast period Leasehold improvements depr sum (nothing in the prior 5 yr) 2012 2013 2014 2015 2016 Computers & copiers depr sum 2009 2010 2011 2012 2013 2014 2015 2016 06/25/2016 17:16:14 0 0 0 0 0 0 0 0 0 0 0 0 0 0 38,030 7,606 0 0 0 7,606 0 7,606 0 0 0 7,606 0 0 7,606 0 0 0 0 12,943 4,314 1,818 4,920 2,799 5,853 0 0 0 0 0 0 0 4,314 0 4,314 606 0 0 7,606 0 0 4,314 606 933 21 Notes to the financial statements Income Statement Revenue Permanent Placement Revenue Temporary Placement Revenue Direct labor expense Net revenue labor + burden for temporary employees placed in client locations Revenue - other Total Revenue Expenses Salary Bonus Burden medical dental insurance, workman's comp Wages & burden Rent Utilities Accounting services tax and audit services Advertising includes web site expenses Travel & entertainment Supplies & equipment includes computer & copier maintenance Postage & express Training & development Memberships Insurance Miscellaneous includes leased vehicle at Capital City Interest Depreciation Total Expense Income before tax Taxes Net Income Balance Sheet Assets Cash Accounts receivable Total current Furniture Leasehold improvements Computers & copiers less depreciation Goodwill purchase of business in Mountainview Total Assets Liabilities Accounts payable Short-term debt Total current Long-term debt Total Liabilities Equity Common stock, $1 par Capital surplus Retained earnings Total Equity Total Liabilities & Equity Comments - In your ratio analysis, remember to focus on what is "actionable" and not merely what is "interesting" information. This involves curiosity about the meaning behind the data. Too often students present superficial results that are interesting, but fail to dig deeper to find what they mean. Curiosity is key here as well as sufficient knowledge to identify all the possibilities that might lead to the situation being observed. Value lies in actionable analysis, not in what is merely interesting. Watch the number of significant digits carried in the data. Think all the way back to elementary school math where you learned (and probably forgot) about significant digits when operating with numbers of differing precision. Presenting excessive significance in your numbers not only overstates the precision upon which the numbers were measured, but requires the reader to extend additional mental power to put the numbers within a proper context. Because you can measure something to the penny does not mean you shouldn't round to thousands or millions to better present the number in a meaningful way. Because your calculator calculates its math to nine decimal places does not mean your answer merits more precision than the original numbers. 2011 actual 2012 actual 2013 actual 2014 actual 2015 actual 2016 estimate 2012 10.4 6.3 2013 11.4 7.3 2014 7.7 4.4 2015 8.1 5.2 2016 7.8 4.9 2012 0.2 0.2 1.2 39.4 40.6 2013 0.2 0.2 1.2 30.5 31.8 2014 0.2 0.3 1.3 17.2 18.2 2015 0.2 0.3 1.3 7.3 8.2 2016 0.2 0.3 1.3 4.0 4.9 2011 3.0 119.9 0.8 1.2 0.6 0.4 2012 2.8 128.8 1.1 0.9 0.7 0.3 2013 2.7 133.0 1.0 1.0 0.5 0.5 2014 2.9 127.8 1.0 1.0 0.4 0.6 2015 3.2 114.2 0.9 1.1 -0.4 1.4 2016 3.0 119.9 0.9 1.1 -1.8 2.8 2011 14.9% 14.9% 2012 15.5% 12.9% 19.9% 2013 12.3% 9.6% 16.6% 0.1 0.1 0.2 0.2 0.6 -1.0% 0.0% 0.1 0.1 -0.1 -4.8% -7.0% 3.1% 0.6 3.4% 0.0% 0.0 1.8% 0.7% 2.8% 0.5 2.4% 0.0% 0.0 2.0% 0.9% 0.40 0.66 0.49 2014 10.9% 0.1% 13.1% 22.3% 0.1 0.1 0.3 -13.0% -6.4% 0.0% 0.4 3.5% 1.3% 0.0% 0.4 0.9% 1.1% 0.0% 0.48 2015 4.7% -4.6% 9.4% 13.4% 0.0 0.1 -0.1 -5.7% -6.1% -19.3% 0.0 1.7% 1.2% -0.2% 0.0 2.2% 1.5% -0.7% 0.18 2016 2.3% -3.1% 6.8% 6.7% 0.0 0.0 0.0 5.3% -3.0% -10.9% 0.0 2.8% 2.0% 1.8% 0.0 3.7% 2.4% 1.5% 0.09 2011 2.7 1.5 2012 3.2 1.9 2013 2.3 1.0 Short-term Liquidity Ratios Total Total 2011 12.7 9.2 Current ratio Cash ratio Long-term Solvency Ratios Total Total Total Total Total Total debt ratio Debt-equity ratio Equity multiplier Times interest earned Cash coverage ratio 2011 0.1 0.1 1.1 35.6 36.0 Asset Utilization Ratios Total Total Total Total Total Total Receivable turnover Days revenue in A/R Total asset turnover Capital intensity Retained earnings, % Dividend payout, % Profitability Ratios Profit margin Total Profit margin, % Cap City Profit margin, % Lakeside Profit margin, % Mountainview Return on assets (ROA) Total Return on equity (ROE) Total Revenue growth, % Total Revenue growth, % Cap City Revenue growth, % Lakeside Revenue growth, % Mountainview Expense growth, % Total Expense growth, % Cap City Expense growth, % Lakeside Expense growth, % Mountainview Labor expense growth, % Total Labor expense growth, % Cap City Labor expense growth, % Lakeside Labor expense growth, % Mountainview Earnings per share, $ Total Current Ratio Cash Ratio StaffAces StaffAces x 1.1% x x Total Debt Ratio StaffAces Profit margin, % StaffAces Return on assets (ROA) StaffAces Return on equity (ROE) StaffAces Revenue growth, % StaffAces Expense growth, % StaffAces Labor expense growth, % StaffAces Earnings per share, $ StaffAces 0.45 0.9% 1.7% 3.1% X 0.43 1.7% 3.6% 6.3% 12.9% 0.48 2.3% 5.5% 10.5% 14.5% Current Ratio Current Ratio StilSim StaffAces 2013 11.40 2.30 2014 7.70 2.60 2015 8.10 2.60 Cash Ratio Cash Ratio StilSim StaffAces 2013 7.30 1.00 2014 4.40 1.10 2015 5.20 1.00 Profit Margin Profit Margin StilSim StaffAces 2013 12.30% 2.30% 2014 10.90% 2.40% 2015 4.70% 2.70% Receivable Turnover Receivable Turnover StilSim StaffAces 2013 2.70 8.60 2014 2.90 8.30 2015 3.20 8.40 Total Debt Ratio Total Debt Ratio StilSim StaffAces 2013 0.16 0.48 2014 0.23 0.45 2015 0.23 0.45 2017 forecast 2018 forecast 2019 forecast 2020 forecast 2021 forecast 2017 2018 2019 2020 2021 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 2017 2018 2019 2020 2021 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 2017 2018 2019 2020 2021 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 2017 2018 2019 2020 2021 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Err:509 Represented in Perceentage 0.114 0.023 0.077 0.026 0.081 0.026 7.3% 1.0% 4.4% 1.1% 5.2% 1.0% 0.027 0.086 0.029 0.083 0.032 0.084