This report is written to analyze the financial statement of Otter Enterprise and present a reasonable appraisal of the valuation of the share capital of the 100000 shares of the private company. The financial statement will be analyzed from following perspectives : profitability analysis, liquidity analysis, financial stability analysis and some appraisal analysis of balance sheet of the Otter Enterprise.After all essential analysis, this essay would present some suggestions and conclusions for you about whether you should purchase the Otter Enterprises or invest your money in a bank term deposit.
Since you has worked as a middle manager in the public service for many years, so it may be easy for you to manage the retail bookshop. The Otter Enterprise Pty Ltd is a private company which has only one shareholder and director of the company. Based on the information that the case given, the Graham who is the only shareholder and director of the company asked for $800,000 to sell 100% of the shares of Otter Enterprises Pty Ltd which is not listed on the stock exchange.
Financial statement analysis
Based on given financial statement, the profitability ratio can be as following:
|Profitability |2010 |2011 |2012 |
|ROA |0.658898305 |0.614736842 |0.538302277 |
|ROE |0.633928571 |0.575144509 |0.478911565 |
|Earnings per share |2.13 |1.99 |1.76 |
|Dividend |175 |179 |153 |
|Dividend payout |0.821596244... [continues]
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