Audit report about AMD group investment joint stock company

II.FINANCIAL ANALYSIS1.Vertical methoda.Balance sheetASSETSCurrent assetsCash and cash equivalentsShortterm investmentsShortterm receivablesInventoriesOther current assetsNoncurrent assetsFixed assetsInvestment propertiesLongterm investmentsTotal assetsLiabilitiesShort term liabilitiesLongterm liabilitiesOwners equityCharter capitalRetained earnings20,701Minority interest14,539Total owners equity and liabilities460,869b.Income statementNet revenueCost of goods soldGross profitFinancial incomeFinancial expensesSelling expensesGeneral and Administrative expensesOperating profitOther profitProfitLoss of investments in associates and joint venturesProfit before taxNet profit after taxProfit after tax for shareholders of the parent companyEarnings per share (VND)CashFlow DirectI. CASH FLOWS FROM OPERATING ACTIVITIES1. Cash receipts from sale of goods, provision of services and other revenue2. Cash paid to suppliers for goods and services3. Cash paid to employees4. Interest paid5. Corporate income tax paid6. Other receipts from operating activities7. Other payments for operating activitiesNet cash flows from operating activitiesII. CASH FLOWS FROM INVESTING ACTIVITIES1. Payment for fixed assets, constructions and other longterm assets2. Receipts from disposal of fixed assets and other longterm assets3. Loans, purchases of other entities debt instruments4. Receipts from loan repayments, sale of other entities debt instruments5. Payments for investment in other entities6. Collections on investment in other entities7. Dividends, interest and profit received8. Other receipts from investing activities9. Other payments for investing activitiesNet cash flows from investing activitiesIII. CASH FLOWS FROM FINANCING ACTIVITIES1. Receipts from equity issue and owners capital contribution2. Payment for share repurchases3. Proceeds from borrowings4. Principal repayments5. Repayment of financial leases6. Dividends paid, profits distributed to owners7. Other receipts from financing activities8. Other payments for financing activitiesNet cash flows from financing activitiesNet cash flows during the periodCash and cash equivalents at beginning of the periodExchange difference due to revaluation of ending balancesCash and cash equivalents at end of the period

I INTRODUCTION

II FINANCIAL ANALYSIS

1 Vertical method

a Balance sheet

b Income statement

c Cash flows statement

2 Financial Statement Ratio

a Liquidity

b Activity

c Profitability

d Coverage

III CONCLUSION

I INTRODUCTION

AMD Group Investment Joint Stock Company

 Launched in 2007 ,when Vietnam's economy were trying to get out of the way of small business to advance to the investment activities, production and sales of depth and a larger scale, AMD Group focuses to provide

services: training, consultancy, research and management By combining advanced scientific management of the world with the practical conditions

in Vietnam, the Group launched the AMD solutions have helped our

customers to stand firm and developed in the context of the economy are significant changes and are suffering significant impacts from the financial crisis led to a global recession

 The growth of customers means that AMD Group confirmed its strong position on the market Our team of young and enthusiastic leadership and group dynamics always grasp investment opportunities, and quickly put AMD Group grown to become a diversified investment group craft projects with large-scale investment and owns the brands reputation in domestic and foreign markets

Currently AMD Group focusing on the main areas of activity are:

+ Consulting - Training - Research

+ Investment tech

+ Business facilities equipment and Services Commercial

+ Education and training

+ Ecotourism

+ Mining

Guideline for the AMD Group is the application of modern science and technology and advanced management technology to provide

customers with innovative products and services, in line with the most effective and lowest cost AMD Group apply sustainable development strategy on the basis of control of resources, proactively for and

minimize risks from the system of macro policy and market change, comply with the law and administrative rules to ensure safe

development, actively embrace the opportunities of investment

In addition, the AMD Group always focuses on the human element, considered as human is the most valuable asset and is the deciding factor for its development The Group constantly recruiting, training staff are qualified, enthusiastic and professional ethics

With the commitment to maximize the benefit for the customer, the AMD Group always striven to provide the products or services have the most perfect value for clients, affirms the brand in and outside the country

II FINANCIAL ANALYSIS

1 Vertical method

a Balance sheet

AMD Group Investment Joint Stock Company Common-size Balance sheet for 2014 and 2015

(VND million)

ASSETS In 2014 In 2015

Cash and cash

Short-term

Short-term

Investment

properties

Long-term

Minority interest 14,539

Total owner's equity

b Income statement

Net revenue In 2014 In 2015

General and

Administrative

expenses

Profit/Loss of

investments in

associates and joint

ventures

Profit before tax

Profit after tax for

shareholders of the

parent company

Earnings per share

c Cash Flows Statement

CashFlow Direct In 2015 In 2014

I CASH FLOWS FROM

OPERATING ACTIVITIES

1 Cash receipts from

sale of goods, provision

of services and other

revenue

2 Cash paid to suppliers

3 Cash paid to

5 Corporate income tax

6 Other receipts from

7 Other payments for

Net cash flows from

II CASH FLOWS FROM

INVESTING ACTIVITIES

1 Payment for fixed

assets, constructions

and other long-term

assets

2 Receipts from

disposal of fixed assets

and other long-term

assets

600

3 Loans, purchases of

other entities' debt

instruments

4 Receipts from loan

repayments, sale of

other entities' debt

instruments

5 Payments for

investment in other

entities

6 Collections on

investment in other

entities

31,000

7 Dividends, interest

8 Other receipts from

2 Financial Statement Ratio

a Liquidity :

Liquidity measures the ease with which AMD Group Investment jsc can meet their financial obligations with the liquid assets available to them There are some ratio:

i Current ratio = Current liabilities Current assets

 This measures short-term debt-paying ability

ii Quick or acid-test ratio = Cash, short term investments∧net receivables Current liabilities

 This measures immediate short-term liquidity

iii Current cash debt coverage = N et cash provided by operating activities Average current liabilities

 This measures a company’s ability to pay of its current liabilities in a given year from its operations

Current cash debt

coverage

 Current ratio > 1 so the company is running quite well and can afford to repay the current debts at maturity The curent ratio in 2015 was also lower than 2014 So it can be said that the firm has used lots of capital for long-term investment and can bring more benefits in the future

 Quick or acid-test ratio is more conservative than the current ratio because

it excludes inventories from current assets The ratio derives its name presumably from the fact that assets such as cash and marketable

securities are quick sources of cash Inventories generally take time to be converted into cash, and if they have to be sold quickly, the company may have to accept a lower price than book value of these inventories As a result, they are justifiably excluded from assets that are ready sources of immediate cash

 The current cash debt coverage droped down thought 2 year in the row

b Activity:

Activity ratios measure a firm's ability to convert different accounts within its balance sheets into cash or sales Activity ratios measure the relative efficiency of a firm based on its use of its assets, leverage or other such balance sheet items and are important in determining

whether a company's management is doing a good enough job of

generating revenues and cash from its resources

i Accounts Receivable turnover = Average account receivables Net sa les

 This measures liquidity of receivables

 Days of receivable = Accounts Receivable turnover365

ii Inventory turnover = Average inventory COGS

 This measures liquidity of inventory

 Days of inventory = Inventory turnover365

iv Asset turnover = Average total assets Net sales

 Measures how efficiently assets are used to generate sales

Accounts Receivable

turnover

Days of receivable 91,94 45,17

 Accounts receivable turnover is an activity ratio that measures how many times a business can turn its accounts receivable into cash during a period

In other words, the accounts receivable turnover ratio measures how many times a business can collect its average accounts receivable during the year Account Receivable turnover had the upward trend over 2 years And the day of receivable is droped throught 2 year => This is a good sign for the firm

 The inventory turnover measure how efficient the company sold out The inventory turnover had the downward trend from 2014 to 2015 It was a negative impact to AMD group

 The asset turnover ratio is a measure of how efficiency a company’s assets are in generating revenue It measures the amount of VND of revenue generated by 1 VND of the company’s assets This ratio increased from 1.04

in 2014 to 2,04 in 2015 We can use this ratio to compare with other company

c Profitability

 Profitability ratios are a class of financial metrics that are used to assess a business's ability to generate earnings compared to its expenses and other relevant costs incurred during a specific period of time

i Profit margin on sales = Net Income Net sales

ii Return on assets = Average total assets Net Income

iii Return on equity = Net income minus preferred dividens Total equity

iv EPS = Weighted−average number of shares outstanding Net Incom e minus preferred dividends

Profit margin on

sales

Return on assets

(%)

Return on equity

(%)

 The profitability ratio measures the earning to investors The investors tend

to prefer to invest in the company that generates more profitability ratios This ratio is the useful to indicate how efficient the company’s

performance The profit margin defines how well the firm generates the profit from net sale And we can see that profit margin on sales is droped from 2014 to 2015

 Gross profit of AMD Group went down from 2014 to 2015

 The trend of ROA, ROE is very high in 2014 and But they dropped out

dramatically in 2015 This stituation was the result of the decreasing in net income

 It was the good news for stockholders of AMD group that EPS of the

company had risen significantly for all 2 years, even the profit in 2015 was quite not good

IV Coverage

 The coverage ratio is a measure of a company's ability to meet its financial obligations In broad terms, the higher the coverage ratio, the better the ability of the enterprise to fulfill its obligations to its lenders

i Debt to assets = Totalliabilities Total assets

 Debt to assets is a coverage ratio that defines the total amount of debt relative to assets

ii Cash debt coverage = Net cash provided by operating activities Average total liabilities

 This measures a company’s ability to repay its total liability in given year from its operations

iii Book value per share = Common stockholder s

' equity Outstanding share

 This measures the amount each share would receive if the company were liquidated at the amounts reported on the balance sheet

assets : The higher the ratio, the higher the degree of leverage, and consequently, financial risk

We can see that the debt to assets is quite stayable in 2 years

 Cash debt coverage is a cash-basis ratio used to evaluate solvency The cash debt coverage ratio stood is higher in 2014 than 2015

III CONCLUSION

Financial Statement analysis and valuation is used to analyze the

performance of an enterprise in the past along with the economic and industry situation to measuring the intrinsic value of stock price of that firm and determine how well the firm performance

Cash debt

coverage

Book value per

share

After doing this financial statement forn AMD group investment JSC

we will have a clearer view of the financial situation of the company From which to decide whether to invest in the company or not This shows the great importance of the financial statement analysis

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