When looking at a business, it is important to be able to analyze all of its financial components. Annual reports tell a specific story to a range of audiences: management, investors, employees, and consumers. This story can explain the state of the business as well as determine a course of action.
Examine financial and accounting information for Netflix, Inc., and Amazon.com, Inc. Use these two companies for this entire project, including their most recent annual reports and financial statements.
Management Discussion and Analysis (MD&A), along with the footnotes of the financial statements. Read the footnotes to the financial statements to see what they disclose about the business’s assets, liabilities, and stockholder equity.
Prepare an Executive Summary (3 pages) comparing Netflix, Inc., and Amazon.com, Inc. The summary must address the following:
What accounts does each company have that you think are distinctive to each company?
Summarize the risk factors mentioned within the MD&A (Item 7 in the 10-K) of the footnotes.
What do you think are the most important balance sheet or income statement accounts that are common to the industry of the two selected companies? Explain.
You will be analyzing Netflix, Inc., and Amazon.com, Inc. You will be using these two companies for this entire project, including the most recent annual reports and financial statements. Directions for finding an Annual Report from the Securities and Exchange Commission (SEC): 1. http://www.sec.gov/ 2. “Search EDGAR for Government Filings” – http://www.sec.gov/edgar/searchedgar/companysearch.html 3. Search Company Name – a. “Amazon” i. Choose “0001018724 – AMAZON COM INC” ii. Choose “10-K Documents” then “FORM 10-K” b. “Netflix Inc.” i. Choose “10-K Documents” then “FORM 10-K” Example Annual Reports: Amazon.com, Inc., Form 10-K, YE 12/31/2014. Retrieved from http://www.sec.gov/Archives/edgar/data/1018724/000101872415000006/amzn- 20141231x10k.htm Netflix, Inc., Form 10-K, YE 12/31/2014. Retrieved from http://www.sec.gov/Archives/edgar/data/1065280/000106528015000006/nflx201410k.ht m