Risk Identification and Mitigation*** Original Answer***Questions answered in full** with references** The company that I picked for my final report is General Motor Corp!!!! Each part labeled and answered,,,,
1. Using the annual report from the company that you have selected foryour Final Project, discuss the risks the company faces and the actionsthey take to mitigate those risks. Refer to the Management Discussionand Analysis section of the annual report for this information.
As part of your response consider whether you think the riskmitigation techniques are reasonable. Discuss what others concerns oradvice you would offer if you had the opportunity.
Include in your post a calculation for the probability ofone of the risks identified by your company. This information may notbe available in the annual report, therefore you will likely need toconduct research and critical thinking to complete this calculation.
Tip: For help with reading an annual report access this handy guide from Money Chimp (http://www.moneychimp.com/articles/financials/fundamentals.htm) .
Develop a 200 – 300 word explanation supporting your position.
2. Imagine you are a representative of management in thecompany you have selected for your Week Six assignment and you mustmake a capital budgeting decision. The decision is to implement a newcomputer network system to decrease the time between customer order anddelivery. The cost will be 10% of last year’s profits. You are chargedwith describing the important considerations in the decision-makingprocess to upper management. In your response, be sure to include thefollowing:
- A description of the important factors, in addition toquantitative factors, that were considered when making this capitalbudgeting decision.
- An explanation of how these factors are significant to the company.
- A summary of how you will determine the criteria torank capital budgeting decisions and whether some criteria are moreimportant than others.
- A calculation of the proposed return on investment based on criteria you select and justification for that ROI.
Develop a 200 – 250 word explanation supporting your recommendations.
Tip: For help with reading an annual report access this handy guide from Money Chimp (http://www.moneychimp.com/articles/financials/fundamentals.htm)
3. As your text describes, ratio analysis is a common technique infinancial analysis. One of your colleagues states that a thoroughratio analysis is all that is needed in considering the financial healthof a company. Although you agree that ratio analysis is a helpfulguide, there may be some potential pitfalls in ratio analysis.
Discuss at least three potential issues in utilizing ratioanalysis that you would share with your colleague. In addition,calculate a liquidity, profitability, and efficiency ratio from yourWeek Six company to demonstrate your observations.
Develop a 200 – 300 word explanation supporting your findings.
Guided Response: Review several of your classmate’s postings.Respond to at least two of your classmates by commenting on anypotential issues in using ratio analysis that were new to you. You mayalso provide another issue that your classmate had not considered.