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In 2012, Abu Dhabi National Hotels had been struggling and the performance of the company had significantly declined, especially that of its main hotel business. Net profit had been decreasing since 2009 and, with this shrinking profitability, shareholders were losing confidence in the company. The share price of the company had also deteriorated and was expected to decline further. With the drop in net profit year after year, investors were very concerned about the company's performance and the direction of its future growth. The company had five business segments - hotels, retail services, catering, transportation and holding - and a deep analysis of the company's performance areas and plan to improve these were needed.

Student spreadsheet for Abu Dhabi National Hotels: What Went Wrong?

The sustainable investing market was a recent phenomenon in the first decade of the 21st century. However, an increasing number of investors began to integrated Environmental, Social and Governance (ESG) issues in investment decisions. At Barclays Capital, Omar Selim had spearheaded the development of Arabesque-a new socially responsible investment firm designed to appeal to all investors wishing to invest according to broadly held environmental and social values, such as limiting environmental externalities and promoting workforce diversity, as well as to investors wishing to align their investments with their faith. Should Selim give up a very successful career to compete in a highly competitive business, in which it could be very hard to build a differentiated offering? Could Arabesque be something different in the world of asset management? And what role, if any, should values and religious faith play in shaping the firm's products and conduct?

The plant manager of an aluminum alloy production plant is faced with capacity constraints and must determine which of two new speciality orders to take on. Both orders cannot be filled simultaneously.<br><br>Students are asked to: (1) perform an industry size-up of the global metals industry and its subset, the aluminum industry; (2) perform a business size-up of the company's current operations; (3) determine the pros and cons of accepting each customer order; (4) calculate the projected contribution margin rates for each product order; (5) analyze, using differential analysis, each customer order and (6) make a decision as to which order to accept.

The plant manager of an aluminum alloy production plant is faced with capacity constraints and must determine which of two new speciality orders to take on. Both orders cannot be filled simultaneously.<br><br>Students are asked to: (1) perform an industry size-up of the global metals industry and its subset, the aluminum industry; (2) perform a business size-up of the company's current operations; (3) determine the pros and cons of accepting each customer order; (4) calculate the projected contribution margin rates for each product order; (5) analyze, using differential analysis, each customer order and (5) make a decision as to which order to accept.

In 2014 Alibaba debuted on the New York Stock Exchange, creating not only the largest IPO in history but this initial desire to list on the Hong Kong Stock Exchange was denied due to the company's desire to preserve its partner's control over decision rights. Why did Hong Kong deny Alibaba's requests to list dual-class shares or to allow its partners to nominate a majority of the board of directors, and in the process turn away a superstar in Alibaba? Why did American stock markets approve of Alibaba's governance structures, despite the warnings of many governance experts? How can investors ensure that their capital would be deployed effectively by the company's top management?

This note introduces multiple concepts of leverage from an accounting context, specifically as they relate to balance sheets and income statements. Both operating- and financial-leverage ratios and their relation to changes in widely accepted profitability measures are reviewed.

This case provides financial statement data for nine companies from nine different industries from Standard & Poor's Capital IQ Net Advantage financial database. Using knowledge of the industries' financial characteristics and financial ratios, the case asks students to match each of the nine financial statement data sets to an appropriate industry. The case provides common-sized income statements (all items scaled by revenues), common-size balance sheets (all items scaled by total assets), and selected financial ratios for the nine companies. All data were averaged over three years 2011-2013 to remove the influence of one-time items and outliers.

In this installment of Accounting Matters, we examine potential consequences of the Financial Accounting Standards Board's Proposed Accounting Standards Updates for Leases. In the context of a previous accounting change (FIN 48), we investigate how these changes will affect firms' accounting choices, investment decisions, debt covenant requirements, and analysis of other key financial data. Changes in accounting standards may have significant indirect economic effect on companies as they can trigger debt covenant violations, restrict access to capital, and distort key financial information used by investors and lenders. New accounting standards may also directly affect the calculation of employee bonuses and incentives that utilize EBITDA or operating income as benchmarks. We include recommendations for managers and identify specific debt covenant components that may limit the negative consequences of the proposed change to lease accounting.

Erin Jones' ridesharing startup in her mid-sized hometown is finally picking up. She's hoping to reach a sustainable scale so that she can sell to a large player such as Uber in a year. But suddenly, she hits political roadblocks - the local Democratic mayor, facing a tough reelection and urged by the local taxi association - calls for more regulation of her business. Erin's board urges her to actively back the opposition Republican candidate through direct PAC giving, a Super PAC, and indirect lobbying. Erin, a lifelong Democrat, is opposed to the Republican on a number of personal issues. She must decide whether and how to engage in this election.

On January 31, 2014, the chief executive officer (CEO) of General Motors (GM), a major automaker located in Detroit, Michigan, must decide whether to issue a recall based on a defect that had been found through an internal safety committee investigation. The ignition switch of certain GM small car models manufactured between 2005 and 2007 was prone to being nudged out of the run position, causing the driver to lose control as the engine would switch off mid-drive, disabling power steering and preventing air bags from being deployed in the case of a collision. If she decided to issue a recall, the CEO needed to consider which car models to include, as well as whether to offer any additional compensation to drivers. Not only would a recall have potential legal and public relations repercussions, but it would present the company with potential future costs. She needed to consider the accounting implications of these contingencies.

The founding partners of this small company must decide whether to use a distributor to sell their products or continue to be their own sales representatives. The company sold a variety of environmentally friendly pens made from recycled paper, often used for fundraising efforts or company promotions. The partners had little access to capital, so they needed to consider the profitability and cash requirement of the alternatives and financing options.

This case has a twofold focus: first, to project a budget for pharmaceuticals based on morbidity patterns, required drug regimens, and unit costs, and to focus on ways the budget might be cut if necessary; second, to prepare a modified version of a breakeven analysis for the community pharmacies.

Supplement case for TCG165.

Discusses the various types of costs that can exist in manufacturing settings; how to compute cost of good manufactured and cost of goods sold; how to determine predetermined overhead rates; how to compute flexible overhead budgets; the managerial use of overhead variances; the distinction between absorption and variable costing; and the impact of JIT on the differences between absorption and variable costing.

Discusses several analytical techniques that incorporate the multi-year period over which a new asset will be used, and looks at three of these techniques (payback period, net present value, and internal rate of return). Examines the choice of a rate of return (or discount rate), the issue of risk, and how companies deal with risk in assessing investment proposals. Also discusses some non-quantitative considerations that can influence senior management's decision about a capital investment (or programming) proposal. Concludes with a description of ways that programming relates to several other organizational activities.

Focuses on the way managers can affect the items on an organization's financial statements. In particular, financial management is concerned with the choices that managers make about (a) the use of debt or equity to finance assets, (b) the structure of debt, (c) the magnitude of net income, and (d) the management of cash. Discusses both the operating cycle and the financing cycle as two cash-related cycles that must be carefully managed.

Discusses some basic techniques for financial statement forecasting, including the operating and financing cycles. Discusses three important financial management concepts: debt structure, leverage, and the role of profit. Makes a distinction between financial risk and business risk. Examines some issues related to financing fixed assets, including issues related to financing growth. Discusses cost behavior and its relationship to forecasting financial statements, and the differential cost concept, Examines some techniques for undertaking alternative choice decisions concerning discontinuing a product line, and discusses several important principles associated with alternative choice decisions. Concludes with a discussion of the concept of contribution and the structure of a contribution income statement.