個案總覽

Set in May 2008, this case reflects the separate perspectives of chief executive officers Tom Eliot and Bill Flinder as they approach the negotiations of RSE International Corporation to acquire Flinder Valves and Controls Inc. The task for the student is to complete a valuation analysis of the target and buyer and to negotiate a price and exchange ratio with the counterparty. The intent of the case design is for students to be organized into teams and assigned to play the part of either Flinder Valves or RSE International in the negotiation. The case provides supplementary private information for each side of the transaction. Therefore, a unique element of the case is negotiating the terms of acquisition in an environment of asymmetric information. The case is relatively simple and provides a first exercise in the negotiation of an acquisition. It could also be taught in the usual case-discussion fashion instead of the intended joint-negotiation exercise

The chief financial officer of an environmentally-focused company that makes all-natural plant fertilizer is considering the introduction of two new plant fertilizing products. The company is committed to being the ultimate eco-capitalist corporation and utilizes an environmentally friendly production process and packing from waste containers, such as recycled pop bottles. Students are expected to complete the following tasks for this case: 1) marketing analysis, 2) corporate size-up, 3) consumer analysis, 4) competitor analysis, 5) a statement of cash flows and interpretation, 6) ratios calculations and analysis, 7) differential analysis for each alternative and 8) income statement and balance sheet projections and interpretation.

This note introduces fundamental financial tools and techniques employed by financial managers and analysts to evaluate and enhance the financial position of a business. Forms of ownership, statement of cash flows, financial ratio analysis, projected financial statements, sensitivity analysis, credit, sources and types of financing, and bankruptcy are discussed in this note.

Financial statements provide company employees, investors, lenders, competitors and shareholders with an understanding of a company's operating results and financial condition. The topics discussed in this note include the statement of earnings, the balance sheet, the statement of retained earnings and the auditor's reports and footnotes.

This note introduces fundamental financial tools and techniques employed by financial managers and analysts to evaluate and enhance the financial position of a business. Forms of ownership, statement of cash flows, financial ratio analysis, projected financial statements, sensitivity analysis, credit, sources and types of financing, and bankruptcy are discussed in this note.

After years of rapid growth and stock price appreciation, New Century Financial Corporation, one of the largest subprime loan originators in the U.S., reported accounting problems in early 2007. The resulting liquidity crisis forced the company to file for Chapter 11 bankruptcy protection. According to the Bankruptcy Examiner assigned to investigate New Century, the company's troubles "were an early contributer to the subprime meltdown" which fueled a financial crisis in the U.S. and beyond. The case study examines New Century's business model and accounting practices and focuses on the role of management, audit committee, and external auditors in the problems at New Century based on the findings of the Bankruptcy Examiner.

This field-based case describes the approach and decisions used by Harris Corporation's vice president of supply chain management and operations to establish a set of financial benchmarks. It requires students to use those benchmarks to decide what areas need focus to potentially raise the company's financial results and elevate its financial performance through specific actions within its supply-chain group.

In 2006, Talbots, Inc., a specialty women's retailer, purchased a competitor, J. Jill. The transaction created a large goodwill account along with accounts for trademarks and other intangible assets. Using prevailing accounting standards (Statement of Financial Accounting Standards No. 142), Talbots determined that the goodwill was not impaired in its Fiscal Year 2007 and it was carried forward at its purchase cost. However, one year later Talbots found the goodwill impaired, along with the trademarks and some store assets acquired from J. Jill in 2006, and these impairments were deducted from revenues in Fiscal Year 2008. Case includes financial statements.

Spreadsheet Supplement for UV0519

In December 1997, an audit partner at Deloitte was required to render an opinion on five separate but related issues arising out of an on-going working relationship with Livent, a Canadian live entertainment firm. Each issue could be treated in multiple ways, and there seemed to be no immediate clear-cut resolution to each. Issues included: assessing impacts of side agreements between Livent and a real-estate development firm; appropriateness of booking revenues for theatre-naming rights in a particular fiscal quarter; auditing of pre-production costs; accounting for proceeds of sale of receivables to related party; and evaluating the audit of accounts payable. It was crucial to resolve each of the issues within a few days in order to complete the file to meet filing requirements. The auditor must determine the best advice for each issue while understanding that Deloitte had to protect its reputation, yet still grow its revenues in the face of aggressive competition for its business.

Cambridge Space Systems plc, a small private company headquartered in Cambridge, England, was engaged in the design and manufacture of small rockets and space systems for commercial, military, and civil customers. In September 2005, Cambridge approached Equator Partners, a private equity firm, about a potential buyout. Since Equator funded its acquisitions with large amounts of debt, potential acquisitions needed excellent cash flow generation, and modest levels of long-term debt. Andrew Amphlett, a recently hired MBA from London Business School, had to analyze Cambridge to determine whether Equator Partners should pursue a buyout of the closely held firm.

On their return to Croatia following a six-year visit to the United States, a couple has decided to open their own coffee house, one that is new to Croatia — a California-style coffee house that offers the quality, service, product assortment, ambiance, and efficiency found in sophisticated coffee shops in developed markets, and all for a locally affordable price. The major challenge faced by the couple is how to grow. Specifically, should they consider franchising over organic growth? If so, how should they go about franchising in a country where the market is developing and where franchising is under-regulated, underdeveloped, and misunderstood?

The chief executive officer (CEO) of Fortune Motors, the largest Mitsubishi dealership in Taiwan, has to consider his vision for the survival of the company. Fortune Motors' sales in 2003 had fallen below 50,000 units for the first time in 10 years, and market share had been falling for several years. The CEO had a plan to enter the business of financing used-car purchases. He thought that the balanced scorecard would be a useful tool to help him implement this change. The first step was to construct a corporate scorecard.

An early adopter of Enterprise Risk Management, energy giant Hydro One anticipated new threats and opportunities in an industry that faced climate change and carbon legislation, the deregulation of electricity markets, and the greater adoption of renewable technologies. CEO Laura Formusa felt Hydro One's risk profile had shifted, to the extent that she had to ask herself -- was the strategy tenable? The case provides a rich description of Enterprise Risk Management in action, and shows how Hydro One executives arrive at a shared understanding of the risk profile of the company. In the narrative a diverse group of managers (the chief executive, the chief financial officer, the head of the public relations and the chief regulatory officer) voice their views on the risks, collectively bringing a multiple stakeholder perspective to the risk profile. The case challenges students to define the problems and risks that the company faces, given its strategic objectives, its evolving risk profile, and the changing environment. The case also offers a discussion ground for defining the role of the chief risk officer, and the relationship between risk management, strategic planning and capital budgeting.

Spreadsheet Supplement for case 109001

The administrator of the Westmount Retirement Residence is concerned about the current cost accounting system. The administrator is not clear on how much each service offered was truly costing, and therefore charged each resident the same price per month regardless of their needs. In the past, the majority of patients demanded similar services, and therefore this pricing and costing system was appropriate. However, with demographic changes to the population, some residents required intense medical care, while others were healthy and fit and required less care. A new pricing model had to be developed that reflected both the size of suite inhabited and the level of medical care and service required by each individual patient.

The administrator of the Westmount Retirement Residence is concerned about the current cost accounting system. The administrator is not clear on how much each service offered was truly costing, and therefore charged each resident the same price per month regardless of their needs. In the past, the majority of patients demanded similar services, and therefore this pricing and costing system was appropriate. However, with demographic changes to the population, some residents required intense medical care, while others were healthy and fit and required less care. A new pricing model had to be developed that reflected both the size of suite inhabited and the level of medical care and service required by each individual patient.

The chief executive officer (CEO) of the London Public Library (LPL) had developed and had begun to implement a strategic plan to improve the LPL. The strategic plan was based on a balanced scorecard. The four perspectives measured by the balanced scorecard were: the community perspective, the internal processes perspective, the organizational readiness perspective and the financial perspective. With two years before the deadline to achieve the plan, the CEO had to decide on what she would focus next.

Students must assess the opportunity of purchasing a business as well as evaluate the likelihood that the potential investor, as a sole proprietor, will receive the required financing. This analysis should include the 4 Cs: character, business conditions, capacity to repay and collateral analysis. This analysis will also entail the qualitative examination of the business to be purchased, the new potential owner's personal characteristics, the dental industry and the location of the proposed business. Following the analysis, students should analyze the opportunity quantitatively by including the preparation and analysis of a statement of cash flows, ratio analysis, projected financial statements and, finally, an analysis of the available sources of collateral to be pledged for the loan.