PROMPT As a new manager, review the company’s past and curre...

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PROMPT
As a new manager, review the company’s past and current financial performance and health and make initial financial projections in order to begin planning for the upcoming year. Your 8-10 page APA report (not counting charts, graphs and references), should include several financial tables, along with a comprehensive narrative describing Wells Fargo’s context, financial performance, and health. Note that, in addition to Wells Fargo’s financial statements and website, other authoritative news sources—such as annual reports and external sites like Bloomberg.com—may offer insights that facilitate analysis or provide information on Wells Fargo’s priorities, challenges, and geographic distribution.

1-Organizational Context
A. What key goods or services does your organization provide, for whom, where, and why?
B. How is the company organized and managed (e.g., by product groups, geographic region, function, etc.)? How does that affect accounting and financial information and subsequent business decisions?

2-Recent Financial Performance
A. Assess what Wells Fargo’s consolidated income statements for the last three years say about its financial performance. Use relevant indicators, graphs, and spreadsheets to support your narrative. (Include all spreadsheets in an appendix.) For example, what do the amounts and year-to-year changes in revenue, operating income, net profit or loss, and Earnings Before Interest, Taxes, Depreciation, and Amortization tell you? Do any items stand out?
B. Assess what Wells Fargo’s consolidated cash flow statements for the same time period say about its financial performance. Use relevant indicators, graphs, and spreadsheets to support your narrative. For example, what do the amounts and year-to-year changes in cash from operating activities, cash from investing, cash from financing, and total cash flow tell you? Do any items stand out?
C. Assess Wells Fargo’s underlying financial performance. Support your answer with the analysis above and relevant research. For example, is recent performance substantially affected by unusual events such as a major acquisition or spin-off? Is the business thriving or struggling in its industry? How do you know?

3. Current Financial Health
A. Assess how Wells Fargo is capitalized and what that tells you about its financial health. Support your response with relevant graphs, spreadsheets, and indicators such as “cash and cash equivalents,” total debt, shareholders’ equity, current ratio, debt/equity ratio, and Days Sales Outstanding (DSO). For example, does Wells Fargo have enough cash for payroll and other bills? Does it have the right mix of debt versus equity (stock)? How do you know?
B. Does Wells Fargo have the right amount of cash and other resources (e.g., key people, technologies, reputation, physical assets, etc.) to fuel future growth? What does this suggest for business decisions? For example, if it has too much cash, should it pay a large dividend, repurchase its own shares, or reinvest the excess funds?
C. Assess the financial value of the company using relevant indicators. What does your assessment imply for future business health and performance? For example, what is the business’s current market value? What is its price-to-earnings ratio? What do these suggest about investor perceptions of the business’s future?

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These solutions may offer step-by-step problem-solving explanations or good writing examples that include modern styles of formatting and construction of bibliographies out of text citations and references. Students may use these solutions for personal skill-building and practice. Unethical use is strictly forbidden.

A. Services
Wells Fargo & Company (“Wells Fargo”, the “Company”) is a San Francisco, CA-based financial services multinational with operations in all 50 states, the District of Columbia and in other countries and territories around the world. The corporation is organized under the laws of Delaware, and is both a financial holding and bank holding company which in addition to the United States has operations in international markets such as India, the Philippines, Canada, the United Kingdom and China among others. As of December 2017, Wells Fargo was ranked among the largest banks in terms of total assets in the United States. The company had $1.95 trillion in total assets and was ranked third behind Bank of America Corporation with $2.28 trillion in total assets and JPMorgan Chase & Company with $2.53 trillion in total assets.
As a diversified financial services multinational, Wells Fargo provides retail, commercial and corporate banking services. The company serves its individual business and institutional customers through its network of banking locations and offices as well as through the internet and other distribution channels. Additionally, Wells Fargo provides other financial services through subsidiaries engaged in various businesses. Some of the services the company provides through subsidiaries include wholesale banking, mortgage banking, consumer finance, equipment leasing, agricultural finance, and commercial finance. The company also provides securities brokerage and investment banking, computer and data processing services, trust services, investment advisory services, mortgage-backed securities servicing and venture capital investment (Wells Fargo, 2018).
B. Company Organization and Management
Wells Fargo has three operating segments for management reporting purposes. The company’s reporting segments are: (1) Community Banking; (2) Wholesale Banking; and (3) Wealth and Investment Management. The company defines its operating segments by product type and customer segment. However, results are based on the management accounting process, and do not follow any comprehensive, authoritative guidance. The management accounting process measures the performance of the operating segments based on the company’s management structure and is not necessarily comparable with similar information for other financial services companies. Additionally, Wells Fargo’s accounting and reporting policies conform with U.S. generally accepted accounting principles (GAAP) and practices in the financial services industry.
Management of Wells Fargo prepares financial statements based on their estimates. These estimates are based on management assumptions about future economic and market conditions. Some of the factors that managers take into account when making estimates include unemployment, market liquidity and real estate process among other factors that affect the reported amounts of assets and liabilities at the date of the financial statements, income and expenses during the reporting period and the related disclosures (Wells Fargo, 2018). Management...

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