Accounting Question

Assignment 2

Use the Excel file “Assignment2Data” to complete this assignment.  The file contains the following variables of interest from 10-Ks filed by retailers for their fiscal years from 2019 – 2023(the most recent 5 years available):

act = current assets

at = total assets

cogs = cost of goods sold

ib = income from continuing operations

invt = inventory

oancf = cash flow from operations

rect = receivables

revt = sales

conm = company name

tic = ticker symbol

fiscal_year = fiscal year

fiscal_year_end = fiscal year end date

au = auditor (see AU – Auditor sheetfor translation of values)

auop = auditor opinion (see AUOP – Opinion sheetfor translation of values)

auopic = auditor opinion over internal controls (see AUOPIC – Internal Controlssheet for translation of values)

Financial statement amounts are in millions of dollars.

Part 1.  Potential Red Flags – Related to Auditor and Audit Opinion

Use the Data spreadsheet, the AU – Auditor, the AUOP – Opinion, and the AUOPIC – Internal Controls spreadsheets in the Assignment2Data Excel file.

Who was the auditor for your company during the last year (fiscal year = 2023)?

Has your company had a different auditor for any of the other years?  If yes, who was the other auditor and what years were they the auditor?

What was the auditor’s opinion for your company during the last year (fiscal year = 2023)?

What was the auditor’s opinion over internal controls for your company during the last year (fiscal year = 2023)?

In what year did the auditor begin serving the company (find this in the audit report from the most recent 10-K)?

Did the auditor mention any critical audit matters in the audit report?  If yes, briefly describe the issue or issues mentioned.

Create a plot that shows your company’s Average Days to Collect Receivables by year as a line graph.  Copy and paste your graph.

Create a plot that shows your company’s Average Days to Sell Inventory by year as a line graph.  Copy and paste your graph.

Create a plot that shows your company’s Long-term Asset Turnover by year as a line graph.  Copy and paste your graph.

Create a plot that shows your company’s Accruals by year as a line graph.  Copy and paste your graph.

What is your company’s Beneish M-score for their most recent fiscal year?  What is your company’s probability of manipulation for that year?  If your company has zero receivables, you will get an error.  To fix this problem, enter the value 1 in cell L10.

Part 2. Potential Red Flags– Graphs

Use the Data spreadsheet in the Assignment2Data Excel file and the formulas from the PowerPoint slides.

Part 3.  Potential Red Flags – Beneish Earnings Manipulation Model

tic
CATO
CATO
CATO
CATO
CATO
TGT
TGT
TGT
TGT
TGT
DDS
DDS
DDS
DDS
DDS
DG
DG
DG
DG
DG
M
M
M
M
M
GPS
GPS
GPS
GPS
GPS
GCO
GCO
GCO
GCO
GCO
KR
KR
KR
KR
KR
JWN
JWN
JWN
JWN
JWN
ROST
conm
CATO CORP -CL A
CATO CORP -CL A
CATO CORP -CL A
CATO CORP -CL A
CATO CORP -CL A
TARGET CORP
TARGET CORP
TARGET CORP
TARGET CORP
TARGET CORP
DILLARDS INC -CL A
DILLARDS INC -CL A
DILLARDS INC -CL A
DILLARDS INC -CL A
DILLARDS INC -CL A
DOLLAR GENERAL CORP
DOLLAR GENERAL CORP
DOLLAR GENERAL CORP
DOLLAR GENERAL CORP
DOLLAR GENERAL CORP
MACY’S INC
MACY’S INC
MACY’S INC
MACY’S INC
MACY’S INC
GAP INC
GAP INC
GAP INC
GAP INC
GAP INC
GENESCO INC
GENESCO INC
GENESCO INC
GENESCO INC
GENESCO INC
KROGER CO
KROGER CO
KROGER CO
KROGER CO
KROGER CO
NORDSTROM INC
NORDSTROM INC
NORDSTROM INC
NORDSTROM INC
NORDSTROM INC
ROSS STORES INC
act
362.797
290.55
355.668
277.673
243.062
12902
20756
21573
17846
17498
1848.082
1661.94
1914.651
2071.846
2208.21
5177.868
6914.219
6303.843
7581.009
8010.724
6810
6184
6758
5853
6089
4516
6008
5165
4617
4395
508.183
667.595
709.798
572.669
507.351
10890
12503
12174
12670
12948
3230
3642
3172
3209
3136
3432.828
at
684.976
591.452
633.766
553.14
486.817
42779
51248
53811
53335
55356
3430.257
3092.515
3245.557
3329.15
3448.906
22825.084
25862.624
26327.371
29083.367
30795.591
21172
17706
17590
16866
16246
13679
13769
12761
11386
11044
1680.478
1587.368
1562.099
1456.426
1329.89
45256
48662
49086
49623
50505
9737
9538
8869
8745
8444
9348.367
cogs
508.906
433.187
453.065
509.664
464.313
54617
65696
74665
81914
77350
4235.978
3069.063
3747.665
3983.598
4031.108
18764.512
22291.677
22771.543
25306.965
26132.685
14190
11327
14082
14449
13246
9673
8588
9529
9664
8588
1084.377
926.996
1190.707
1205.88
1176.363
95294
101597
107539
116480
116675
9271
6899
8729
9405
8717
11185.295
ib
35.897
-47.483
36.844
0.029
-23.941
3269
4368
6946
2780
4138
111.081
-71.654
862.473
891.637
738.847
1712.555
2655.05
2399.232
2415.989
1661.274
564
-3944
1430
1177
105
351
-665
256
-202
502
61.757
-56.028
114.947
72.242
-23.628
1659
2585
1655
2244
2164
496
-690
178
245
134
1660.928
invt
115.365
84.123
124.907
112.056
98.603
8992
10653
13902
13499
11886
1465.007
1087.763
1080.178
1120.208
1093.999
4676.848
5247.477
5614.325
6760.733
6994.266
5188
3774
4383
4267
4361
2156
2451
3018
2389
1995
365.269
290.966
278.2
458.017
378.967
7084
7063
6783
7560
7105
1920
1863
2289
1941
1888
1832.339
ROST ROSS STORES INC
ROST ROSS STORES INC
ROST ROSS STORES INC
ROST ROSS STORES INC
WMT WALMART INC
WMT WALMART INC
WMT WALMART INC
WMT WALMART INC
WMT WALMART INC
WSM WILLIAMS-SONOMA INC
WSM WILLIAMS-SONOMA INC
WSM WILLIAMS-SONOMA INC
WSM WILLIAMS-SONOMA INC
WSM WILLIAMS-SONOMA INC
FL
FOOT LOCKER INC
FL
FOOT LOCKER INC
FL
FOOT LOCKER INC
FL
FOOT LOCKER INC
FL
FOOT LOCKER INC
TJX
TJX COS INC (THE)
TJX
TJX COS INC (THE)
TJX
TJX COS INC (THE)
TJX
TJX COS INC (THE)
TJX
TJX COS INC (THE)
BIG
BIG LOTS INC
BIG
BIG LOTS INC
BIG
BIG LOTS INC
BIG
BIG LOTS INC
BIG
BIG LOTS INC
SIG
SIGNET JEWELERS LTD
SIG
SIGNET JEWELERS LTD
SIG
SIGNET JEWELERS LTD
SIG
SIGNET JEWELERS LTD
SIG
SIGNET JEWELERS LTD
SPWH SPORTSMANS WAREHOUSE HLDGS
SPWH SPORTSMANS WAREHOUSE HLDGS
SPWH SPORTSMANS WAREHOUSE HLDGS
SPWH SPORTSMANS WAREHOUSE HLDGS
SPWH SPORTSMANS WAREHOUSE HLDGS
BURL BURLINGTON STORES INC
BURL BURLINGTON STORES INC
BURL BURLINGTON STORES INC
BURL BURLINGTON STORES INC
BURL BURLINGTON STORES INC
LE
LANDS’ END INC
LE
LANDS’ END INC
LE
LANDS’ END INC
6692.491
7473.176
6904.719
7398.138
61806
90067
81070
75655
76877
1755.635
2467.08
2323.894
2036.08
2719.797
2386
2835
2363
2521
2225
8890.622
15739.337
13258.597
12456
12664
1063.949
1585.789
1410.968
1285.314
1086.023
3154.8
3582
3730.4
3507.1
3536.6
291.638
324.653
467.47
425.896
380.048
1417.371
2510.616
2547.644
2283.792
2327.024
545.378
495.83
506.949
12717.867
13640.256
13416.463
14300.109
236495
252496
244860
243197
252399
4054.042
4661.424
4625.62
4663.016
5273.548
6589
7043
8135
7907
6868
24145.003
30813.555
28461.458
28349
29747
3189.281
4037.257
3927.253
3690.931
3325.309
6299.1
6178.9
6575.1
6620.4
6813.2
616.641
660.818
840.581
858.96
886.205
5593.859
6781.092
7089.513
7269.597
7706.84
1113.629
1045.508
1036.634
9335.329
13348.243
13551.575
14382.169
383618
409163
418342
452776
478289
3571.157
3946.887
4417.886
4782.531
4212.32
5462
5365
5878
5955
5895
28987.58
23353.815
33877.951
35267
36981
3208.498
3701.8
3753.596
3554.826
3035.488
3726.2
3317
4533.1
4612.1
4182.4
570.448
953.484
989.549
907.499
865.565
4225.76
3280.414
5436.155
5171.715
5584.06
828.309
821.595
945.164
85.382
1722.589
1512.041
1874.52
14881
13510
13673
11680
15511
356.062
680.714
1126.337
1127.904
949.762
491
323
893
345
-330
3272.193
90.47
3282.815
3498
4474
242.464
629.191
177.778
-210.708
-481.876
105.5
-15.2
769.9
376.7
810.4
20.215
91.38
108.47
40.518
-28.997
465.116
-216.499
408.839
230.123
339.649
19.29
10.836
33.369
1508.982
2262.273
2023.495
2192.22
44435
44949
56511
56576
54892
1100.544
1006.299
1246.372
1456.123
1246.369
1208
923
1266
1643
1509
4872.592
4337.389
5961.573
5819
5965
921.266
940.294
1237.797
1147.949
953.302
2331.7
2032.5
2060.4
2150.3
1936.6
275.505
243.434
386.56
399.128
354.71
777.248
740.788
1021.009
1181.982
1087.841
375.67
382.106
384.241
LE
LANDS’ END INC
LE
LANDS’ END INC
OLLI OLLIE’S BARGAIN OUTLET HLDGS
OLLI OLLIE’S BARGAIN OUTLET HLDGS
OLLI OLLIE’S BARGAIN OUTLET HLDGS
OLLI OLLIE’S BARGAIN OUTLET HLDGS
OLLI OLLIE’S BARGAIN OUTLET HLDGS
DBI
DESIGNER BRANDS INC
DBI
DESIGNER BRANDS INC
DBI
DESIGNER BRANDS INC
DBI
DESIGNER BRANDS INC
DBI
DESIGNER BRANDS INC
BKE BUCKLE INC
BKE BUCKLE INC
BKE BUCKLE INC
BKE BUCKLE INC
BKE BUCKLE INC
KSS
KOHL’S CORP
KSS
KOHL’S CORP
KSS
KOHL’S CORP
KSS
KOHL’S CORP
KSS
KOHL’S CORP
DLTH DULUTH HOLDINGS INC
DLTH DULUTH HOLDINGS INC
DLTH DULUTH HOLDINGS INC
DLTH DULUTH HOLDINGS INC
DLTH DULUTH HOLDINGS INC
SCVL SHOE CARNIVAL INC
SCVL SHOE CARNIVAL INC
SCVL SHOE CARNIVAL INC
SCVL SHOE CARNIVAL INC
SCVL SHOE CARNIVAL INC
URBN URBAN OUTFITTERS INC
URBN URBAN OUTFITTERS INC
URBN URBAN OUTFITTERS INC
URBN URBAN OUTFITTERS INC
URBN URBAN OUTFITTERS INC
AEO AMERN EAGLE OUTFITTERS INC
AEO AMERN EAGLE OUTFITTERS INC
AEO AMERN EAGLE OUTFITTERS INC
AEO AMERN EAGLE OUTFITTERS INC
AEO AMERN EAGLE OUTFITTERS INC
DLTR DOLLAR TREE INC
DLTR DOLLAR TREE INC
DLTR DOLLAR TREE INC
DLTR DOLLAR TREE INC
DLTR DOLLAR TREE INC
556.726
410.26
433.538
808.767
726.828
754.296
871.428
900.81
780.585
914.216
789.931
777.432
378.83
437.224
391.206
423.336
444.256
4649
5835
5023
3736
3410
162.192
210.31
222.521
225.897
180.974
329.647
355.305
442.032
469.723
481.338
1053.396
1223.332
1285.747
1237.719
1282.503
1047.93
1522.643
1396.924
1100.241
1433.35
4269.4
5050.8
5609.2
6367.1
6132.7
1082.148
811.479
1596.247
2005.855
1972.172
2044.096
2294.594
2465.07
1976.595
2014.634
2009.618
2076.232
867.89
845.814
780.884
837.579
889.81
14555
15337
15054
14345
14009
474.05
515.577
515.55
527.454
490.453
628.374
642.747
812.264
989.781
1042.025
3315.633
3546.345
3791.347
3682.912
4111.209
3328.679
3434.806
3786.643
3420.956
3557.909
19574.6
20696
21721.8
23022.1
22023.5
961.663
-12.53
846.981 -130.684
849.649
141.13
1079.695 242.696
1066.219 157.455
1165.133
102.79
1263.18 181.439
2406.368
94.497
1831.776 -488.719
2050.023 154.481
2154.888 162.676
2035.85
29.062
498.991 104.429
479.747 130.139
622.909
254.82
650.329 254.626
621.207 219.919
12140
691
10173
-163
11437
938
11457
-19
10498
317
287.475
18.921
307.257
13.577
321.26
29.702
309.872
2.304
321.71
-9.356
707.882
42.914
681.983
15.991
787.851 154.881
773.171 110.068
728.692
73.348
2617.802 168.096
2455.55
1.236
2955.755 310.616
3263.784 159.699
3319.133 287.674
2782.739 191.257
2610.203 -209.274
3017.816 419.629
3234.306 125.136
3213.527 170.038
15981.5
827
17043.2
1341.9
17869
1327.9
18658.9
1615.4
20344.8
-998.4
425.513
301.724
335.181
353.704
467.306
470.534
505.79
632.587
473.183
586.429
605.652
571.331
121.258
101.063
102.095
125.134
126.29
3537
2590
3067
3189
2880
147.849
149.052
122.672
154.922
125.757
259.495
233.266
285.205
390.39
346.442
409.534
389.618
569.699
587.51
550.242
446.278
405.445
553.458
585.083
640.662
3522
3427
4367.3
5449.3
5112.8
ANF ABERCROMBIE & FITCH -CL A
ANF ABERCROMBIE & FITCH -CL A
ANF ABERCROMBIE & FITCH -CL A
ANF ABERCROMBIE & FITCH -CL A
ANF ABERCROMBIE & FITCH -CL A
HIBB HIBBETT INC
HIBB HIBBETT INC
HIBB HIBBETT INC
HIBB HIBBETT INC
HIBB HIBBETT INC
KIRK KIRKLAND’S INC
KIRK KIRKLAND’S INC
KIRK KIRKLAND’S INC
KIRK KIRKLAND’S INC
KIRK KIRKLAND’S INC
DKS DICKS SPORTING GOODS INC
DKS DICKS SPORTING GOODS INC
DKS DICKS SPORTING GOODS INC
DKS DICKS SPORTING GOODS INC
DKS DICKS SPORTING GOODS INC
BBW BUILD-A-BEAR WORKSHOP INC
BBW BUILD-A-BEAR WORKSHOP INC
BBW BUILD-A-BEAR WORKSHOP INC
BBW BUILD-A-BEAR WORKSHOP INC
BBW BUILD-A-BEAR WORKSHOP INC
ZUMZ ZUMIEZ INC
ZUMZ ZUMIEZ INC
ZUMZ ZUMIEZ INC
ZUMZ ZUMIEZ INC
ZUMZ ZUMIEZ INC
CTRN CITI TRENDS INC
CTRN CITI TRENDS INC
CTRN CITI TRENDS INC
CTRN CITI TRENDS INC
CTRN CITI TRENDS INC
FIVE FIVE BELOW INC
FIVE FIVE BELOW INC
FIVE FIVE BELOW INC
FIVE FIVE BELOW INC
FIVE FIVE BELOW INC
ULTA ULTA BEAUTY INC
ULTA ULTA BEAUTY INC
ULTA ULTA BEAUTY INC
ULTA ULTA BEAUTY INC
ULTA ULTA BEAUTY INC
TLYS TILLY’S INC
TLYS TILLY’S INC
1264.749
1661.629
1507.759
1228.018
1537.265
372.512
439.8
277.014
473.055
406.715
131.511
170.698
149.569
94.331
85.509
2410.016
3759.65
5106.656
4963.186
4890.049
98.75
100.193
129.998
147.431
127.772
412.588
535.277
447.649
340.178
326.587
201.207
244.442
192.607
222.881
225.099
665.713
755.413
904.739
1066.379
1203.542
2055.317
2514.777
2281.183
2709.304
2836.518
208.864
212.156
3549.665
3314.902
2939.491
2713.1
2974.233
769.759
808.166
703.217
939.16
909.222
422.442
387.112
331.189
274.246
250.573
6628.56
7752.859
9041.676
8992.196
9311.752
297.262
261.372
266.324
280.794
272.325
914.258
998.364
862.012
747.903
664.226
459.145
494.593
474.025
544.258
518.721
1958.661
2314.77
2880.46
3324.911
3872.037
4863.872
5089.969
4764.379
5370.411
5707.011
546.64
505.473
1298.53
1219.379
1400.773
1593.213
1587.265
799.827
912.126
1044.777
1106.415
1145.184
417.43
353.707
355.933
368.569
334.242
5928.65
6188.512
7262.082
7748.94
8083.38
171.215
137.263
181.291
209.583
208.065
666.393
636.021
725.934
632.032
592.909
484.74
471.618
584.063
484.022
462.311
1172.764
1309.807
1817.91
1980.817
2285.544
4421.405
3905.022
4993.875
5922.698
6582.363
411.644
370.084
39.358
-114.021
263.01
2.816
328.123
27.344
74.266
174.313
128.057
103.158
-53.265
16.639
22.026
-44.694
-27.751
297.462
530.251
1519.871
1043.138
1046.519
0.261
-22.983
47.265
47.985
52.805
66.881
76.227
119.289
21.034
-62.61
16.503
23.978
62.24
58.892
-11.979
175.056
123.361
278.81
261.528
301.106
705.945
175.835
985.837
1242.408
1291.005
22.622
-1.145
434.326
404.053
525.864
505.621
469.466
288.011
202.038
221.219
420.839
344.294
94.674
62.083
114.029
84.071
74.09
2202.275
1953.568
2297.609
2830.917
2848.797
53.381
46.947
71.809
70.485
63.499
135.095
134.354
128.728
134.824
128.827
138.258
103.845
123.835
105.794
130.432
324.028
281.267
455.104
527.72
584.627
1293.701
1168.215
1499.218
1603.451
1742.136
56.901
55.698
TLYS
TLYS
TLYS
TILLY’S INC
TILLY’S INC
TILLY’S INC
227.978
202.398
176.059
504.823
475.752
429.545
482.195
455.398
444.592
64.249
9.677
-34.492
65.645
62.117
63.159
oancf
rect
revt au auop auopic fiscal_year fiscal_year_end
53.396 26.088
825.335 7 4
1
2019
1/31/2020
-30.71 52.743
575.111 7 4
1
2020
1/31/2021
59.788 55.812
769.271 7 1
1
2021
1/31/2022
13.37 26.497
759.26 7 1
1
2022
1/31/2023
0.477 29.751
708.059 7 1
1
2023
1/31/2024
7117
962
78112 4 1
1
2019
1/31/2020
10525
1135
93561 4 1
1
2020
1/31/2021
8625
1353
106005 4 1
1
2021
1/31/2022
4018
1695
109120 4 1
1
2022
1/31/2023
8621
1404
107412 4 1
1
2023
1/31/2024
365.074 48.339 6343.211 6 4
1
2019
1/31/2020
252.946 155.582 4433.185 6 4
1
2020
1/31/2021
1280.02 42.624 6624.267 6 1
1
2021
1/31/2022
948.391
57.75 6996.215 6 1
1
2022
1/31/2023
883.59 62.242
6874.42 6 1
1
2023
1/31/2024
2237.998 76.537 27753.973 4 4
1
2019
1/31/2020
3876.159
90.76 33746.839 4 1
1
2020
1/31/2021
2865.811
0 34220.449 4 1
1
2021
1/31/2022
1984.555
0 37844.863 4 1
1
2022
1/31/2023
2391.798
0 38691.609 4 1
1
2023
1/31/2024
1608
409
25331 6 4
1
2019
1/31/2020
649
276
18097 6 4
1
2020
1/31/2021
2712
297
25292 6 1
1
2021
1/31/2022
1615
300
25305 6 1
1
2022
1/31/2023
1305
293
23866 6 1
1
2023
1/31/2024
1411
316
16383 5 4
1
2019
1/31/2020
237
363
13800 5 4
1
2020
1/31/2021
809
399
16670 5 1
1
2021
1/31/2022
607
340
15616 5 1
1
2022
1/31/2023
1532
289
14889 5 1
1
2023
1/31/2024
117.17 29.195 2197.066 4 4
1
2019
1/31/2020
157.741
31.41
1786.53 4 1
1
2020
1/31/2021
239.87 39.509 2422.084 4 1
1
2021
1/31/2022
-164.884 40.818 2384.888 4 1
1
2022
1/31/2023
94.796 53.618 2324.624 4 1
1
2023
1/31/2024
4664
1706
122286 7 4
1
2019
1/31/2020
6815
1781
132498 7 4
1
2020
1/31/2021
6190
1828
137888 7 1
1
2021
1/31/2022
4498
2234
148258 7 1
1
2022
1/31/2023
6788
2136
150039 7 1
1
2023
1/31/2024
1236
179
15524 5 4
1
2019
1/31/2020
-348
805
10715 5 4
1
2020
1/31/2021
705
273
14789 5 1
1
2021
1/31/2022
946
265
15530 5 1
1
2022
1/31/2023
621
334
14693 5 1
1
2023
1/31/2024
2171.546 102.236 16039.073 5 4
1
2019
1/31/2020
2245.933
1738.849
1689.373
2514.49
25255
36074
24181
28841
35726
607.294
1274.848
1371.147
1052.822
1680.273
696
1062
666
173
91
4066.54
4561.889
3057.485
4084
6057
338.97
399.349
193.762
-144.286
-251.96
555.7
1372.3
1257.3
797.9
546.9
77.866
238.816
-21.626
46.794
52.266
891.725
219.181
833.159
596.385
868.735
27.289
91.633
70.569
115.067
119.247
145.694
130.766
6284
6516
8280
7933
8796
111.737
143.728
131.683
115.685
122.914
101
125
136
160
160
386.261
497.401
632.16
682
588
0
0
0
0
0
45.1
140.4
43.1
24.1
18.8
1.716
0.581
1.937
2.053
2.119
91.508
281.861
299.589
71.091
74.361
50.953
37.574
49.668
12531.565 5 4
18916.244 5 1
18695.829 5 1
20376.941 5 1
521426 4 4
556933 4 1
569962 4 1
608481 4 1
645737 4 1
5898.008 5 4
6783.189 5 1
8245.936 5 1
8674.417 5 1
7750.652 5 1
8005 6 4
7548 6 1
8958 6 1
8759 6 1
8168 6 1
41716.977 7 4
32136.962 7 4
48549.982 7 4
49936 7 1
54217 7 1
5323.18 5 4
6199.186 5 4
6150.603 5 1
5468.329 5 1
4722.099 5 1
6137.1 6 4
5226.9 6 4
7826 6 1
7842.1 6 1
7171.1 6 1
886.401 6 4
1451.767 17 1
1506.072 17 1
1399.515 17 1
1287.987 17 1
7286.398 9 4
5763.98 5 4
9322.256 5 4
8702.604 5 4
9727.467 5 4
1450.201 5 4
1427.448 5 4
1636.624 5 1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2
1
1
1
1
1
1
1
1
1
1
1
1
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
-36.367
130.565
105.344
361.254
45.033
114.346
254.497
196.707
-153.793
171.429
201.426
162.399
130.665
227.42
311.754
242.382
254.644
1657
1338
2271
282
1168
6.696
50.751
91.981
-5.628
38.673
66.946
63.395
147.893
50.438
122.756
273.893
285.814
359.319
142.729
509.411
415.416
202.498
303.671
406.296
580.71
1869.8
2716.3
1431.5
1614.8
2684.5
44.928
35.295
2.84
0.621
1.372
2.374
2.223
89.151
196.049
199.826
77.763
83.59
3.136
2.823
12.087
12.648
8.697
15
789
190
210
167
3.121
2.82
5.455
6.041
6.572
2.724
7.096
14.159
3.052
2.593
88.288
89.952
63.76
70.339
67.008
119.064
146.102
286.683
242.386
247.934
113.3
0
0
0
0
1555.429 11 1
1472.508 11 1
1408.199 6 4
1808.821 6 4
1752.995 6 1
1827.009 6 1
2102.662 6 1
3492.687 5 4
2234.719 5 4
3196.583 5 1
3315.428 5 1
3074.976 5 1
900.254 5 4
901.278 5 4
1294.607 5 1
1345.187 5 1
1261.102 5 1
19974 4 4
15955 4 1
19433 4 1
18098 4 1
17476 4 1
615.624 17 4
638.783 17 1
698.584 6 1
653.307 6 1
646.681 6 1
1036.551 5 4
976.765 5 4
1330.394 5 1
1262.235 5 1
1175.882 5 1
3983.789 5 4
3449.749 5 4
4548.763 5 1
4795.244 5 1
5153.237 5 1
4308.212 4 4
3759.113 4 1
5010.785 4 1
4989.833 4 1
5261.77 4 1
23610.8 6 4
25509.3 6 4
26321.2 6 1
28331.7 6 1
30603.8 6 1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
0
1
1
1
2
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
300.685
404.918
277.782
-2.343
653.422
92.289
197.716
159.488
77.043
118.699
-8.269
78.563
-30.785
-18.151
-14.476
404.612
1552.769
1616.872
921.881
1527.335
21.609
13.386
28.077
47.276
64.31
105.642
138.412
134.95
-0.379
14.755
42.609
110.858
74.319
5.754
-9.577
187.029
365.966
327.912
314.926
499.619
1101.293
810.355
1059.265
1481.915
1476.266
36.434
38.897
80.251
83.857
69.102
104.506
78.346
8.477
11.905
13.607
12.85
16.743
1
3.3
4.7
0.842
2.6
58.935
59.545
70.241
79.473
118.985
11.526
8.295
11.701
15.374
8.569
16.841
16.558
14.427
20.613
13.78
1.186
0
3.987
0.615
4.123
0
0
0
0
0
139.337
193.109
233.682
199.422
207.939
7.485
8.724
3623.073 7 4
3125.384 7 4
3712.768 7 4
3697.751 7 1
4280.677 7 1
1184.234 6 4
1419.657 4 1
1691.184 4 1
1708.316 4 1
1728.887 4 1
603.88 4 4
543.496 4 1
558.18 4 1
498.825 4 1
468.69 4 1
8750.743 5 1
9584.019 5 1
12293.368 5 1
12368.198 5 1
12984.399 5 1
338.543 4 4
255.31 4 1
411.522 4 1
467.937 4 1
486.114 4 1
1034.129 23 4
990.652 23 1
1183.867 23 1
958.38 23 1
875.486 23 1
781.925 6 4
783.294 6 4
991.595 5 1
795.011 5 1
747.941 5 1
1846.73 6 4
1962.137 6 4
2848.354 6 1
3076.308 6 1
3559.369 6 1
7398.068 4 4
6151.953 4 4
8630.889 4 1
10208.58 4 1
11207.303 4 1
619.3 11 4
531.329 11 4
1
2
1
1
1
1
1
1
1
1
1
0
1
0
0
1
1
1
1
1
1
0
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
2021
2022
2023
2019
2020
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
1/31/2022
1/31/2023
1/31/2024
1/31/2020
1/31/2021
63.402
-1.415
-6.733
6.705
9.24
5.947
775.694 11 1
672.28 11 1
623.083 11 1
1
1
1
2021
2022
2023
1/31/2022
1/31/2023
1/31/2024
Code
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
Description
Unaudited
Arthur Andersen
Arthur Young (prior to October 1, 1989)
Coopers & Lybrand (known as Coopers & Lybrand Deloitte in the United Kingdom since April 29, 1990; Coopers
& Lybrand merged with Price Waterhouse on July 1, 1998)
Ernst & Young (Ernst & Whinney from July 1, 1989 to September 29, 1989; Ernst & Ernst prior to July 1, 1989)
Deloitte & Touche (Deloitte, Haskins and Sells prior to December 4, 1989; Haskins & Sells prior to May 1, 1978)
KPMG (Peat, Marwick, Mitchell prior to April 1, 1987)
PricewaterhouseCoopers (Price Waterhouse prior to July 1, 1998 merger with Coopers and Lybrand)
Touche Ross (merged with Deloitte, Haskins and Sells on December 4, 1989)
Other
Altschuler, Melvoin and Glasser
Binder, Dijker, Otte (known as BDO Seidman in North America)(Seidman and Seidman prior to September 1,
1988)
Baird, Kurtz and Dobson
Cherry, Bekaert and Holland
Clarkson, Gordon
Clifton, Gunderson
Crowe Chizek
Grant Thornton
J H Cohn
Kenneth Leventhal
Laventhol and Horwath
McGladrey and Pullen (McGladrey, Hendrickson and Pullen prior to May 1988)
Moore Stephens
Moss Adams
Pannell Kerr Foster
Plante & Moran
Richard A. Eisner
Spicer & Oppenheim
Code Description
0
Unaudited
1
Unqualified
2
Qualified
3
No opinion
Unqualified with
additional language
4
5
Adverse opinion
The financial statements were not audited because they represent consolidated accounts and the auditor’s letter
refers only to parent accounts.
The financial statements are presented fairly and the auditing firm approves of the accounting principles reflected
in the financial statements, the consisency of their application and the adequacy of financial disclosure.
The financial statements are presented fairly, but the auditing firm is concerned about either limitation on the
scope of the examination or unsatisfactory financial statement presentations.
The auditing firm does not express an opinion regarding the company’s capabillity to continue business
operations.
The auditing firm’s opinion is unqualified, but explanatory language has been added to the standard report.
This code indicates that the financial statements are not presented fairly and the auditing firm does not approve of
the accounting principles reflected in the financial statements, the consistency of their applications or the
adequacy of financial disclosure.
Code
0
1
2
3
4
Description
No Auditor’s report
Effective (No Material Weakness)
Adverse (Material Weakness Exists)
Disclaimer (Unable to Express Opinion)
Delayed Filing
NAME:
TJX COS INC (THE)
TICKER SYMBOL:
TJX
PRIMARY SIC CODE:
5651
STOCK EXCHANGE:
11
CUSIP:
New York Stock Exchange
872540
STATEMENT OF FINANCIAL POSITION
Fiscal Year:
(FYR Ending):
2018
2019
(31JAN2019 ) (31JAN2020 )
2020
2021
2022
(31JAN2021 )
(31JAN2022 )
(31JAN2023 )
ASSETS
Cash & Equivalents
3,030.229
3,216.752
10,469.570
6,226.765
5,477.000
346.298
386.261
497.401
632.160
682.000
4,579.033
4,872.592
4,337.389
5,961.573
5,819.000
513.662
415.017
434.977
438.099
478.000
8,469.222
8,890.622
15,739.337
13,258.597
12,456.000
Plant, Property & Equip (Gross)
10,729.119
20,432.610
20,752.823
21,289.560
22,403.000
Accumulated Depreciation
5,473.911
6,047.230
6,726.729
7,164.799
7,534.000
Plant, Property & Equip (Net)
5,255.208
14,385.380
14,026.094
14,124.761
14,869.000
.000
225.000
196.000
186.000
186.000
Receivables – Total (Net)
Inventories – Total
Prepaid Expenses
Current Assets – Other
Current Assets – Total
Investments at Equity
Investments and Advances – Other
.000
.000
.000
.000
.000
235.499
228.911
224.446
219.543
217.000
.000
.000
.000
.000
.000
Assets – Other
366.100
415.090
627.678
672.557
621.000
TOTAL ASSETS
14,326.029
24,145.003
30,813.555
28,461.458
28,349.000
2,644.143
2,672.557
4,823.397
4,465.427
3,794.000
.000
.000
.000
.000
.000
Intangibles
Deferred Charges
LIABILITIES
Accounts Payable
Notes Payable
Accrued Expenses
Taxes Payable
154.155
24.700
81.523
181.155
55.000
.000
1,411.216
2,427.289
1,576.561
2,110.000
2,733.076
3,041.774
3,471.459
4,244.997
4,346.000
Total Current Liabilities
5,531.374
7,150.247
10,803.668
10,468.140
10,305.000
Long Term Debt
2,476.874
10,053.258
13,076.137
10,930.431
10,634.000
Debt (Long-Term) Due In One Year
Other Current Liabilities
Deferred Taxes (Balance Sheet)
158.191
Investment Tax Credit
142.170
37.164
44.175
127.000
.000
.000
.000
.000
.000
1,110.984
851.116
1,063.902
1,015.720
919.000
.000
.000
.000
.000
.000
9,277.423
18,196.791
24,980.871
22,458.466
21,985.000
Preferred Stock
.000
.000
.000
.000
.000
Common Stock
1,217.183
1,199.100
1,204.698
1,181.189
1,155.000
Capital Surplus
.000
.000
260.515
.000
.000
3,831.423
4,749.112
4,367.471
4,821.803
5,209.000
Liabilities – Other
Noncontrolling Interest – Redeemable
TOTAL LIABILITIES
SHAREHOLDERS’ EQUITY
Retained Earnings (Net Other)
Less: Treasury Stock
.000
.000
.000
.000
.000
5,048.606
5,948.212
5,832.684
6,002.992
6,364.000
.000
.000
.000
.000
.000
TOTAL SHAREHOLDERS EQUITY
5,048.606
5,948.212
5,832.684
6,002.992
6,364.000
TOTAL LIABILITIES AND EQUITY
14,326.029
24,145.003
30,813.555
28,461.458
28,349.000
2018
2019
2020
2021
2022
(31JAN2021 )
(31JAN2022 )
(31JAN2023 )
Shareholders Equity – Parent
Noncontrolling Interest – Nonredeemable
INCOME STATEMENT
Fiscal Year:
(FYR Ending):
Sales (Net)
(31JAN2019 ) (31JAN2020 )
38,972.934
41,716.977
32,136.962
48,549.982
49,936.000
27,012.277
28,978.477
23,341.057
33,872.810
35,262.000
11,960.657
12,738.500
8,795.905
14,677.172
14,674.000
Selling, General, & Admin Expenses
6,923.564
7,454.988
7,454.917
9,295.238
8,927.000
Operating Income Before Depreciation
5,037.093
5,283.512
1,340.988
5,381.934
5,747.000
Depreciation, Depletion, & Amortiz
818.900
867.303
870.758
868.002
887.000
Operating Income After Depreciation
Cost of Goods Sold
Gross Profit
4,218.193
4,416.209
470.230
4,513.932
4,860.000
Interest Expense
69.102
61.400
199.038
123.196
91.000
Non-Operating Income/Expense
60.242
51.374
18.304
8.120
85.000
Special Items
-36.122
.000
-200.233
-1.248
-218.000
Pretax Income
4,173.211
4,406.183
89.263
4,397.608
4,636.000
1,113.413
1,133.990
-1.207
1,114.793
1,138.000
.000
.000
.000
.000
.000
3,059.798
3,272.193
90.470
3,282.815
3,498.000
Income Taxes – Total
Minority Interest
Income Before EI&DO
Extraordinary Items
.000
.000
.000
.000
.000
Discontinued Operations
.000
.000
.000
.000
.000
Net Income (Loss)
3,059.798
3,272.193
90.470
3,282.815
3,498.000
Income Before EI&DO
3,059.798
3,272.193
90.470
3,282.815
3,498.000
Preferred Dividends
.000
.000
.000
.000
.000
3,059.798
3,272.193
90.470
3,282.815
3,498.000
.000
.000
.000
.000
.000
3,059.798
3,272.193
90.470
3,282.815
3,498.000
EPS – Primary, Excluding EI&DO
2.470
2.710
.080
2.740
3.000
EPS – Primary, Including EI&DO
2.470
2.710
.080
2.740
3.000
EPS – Fully Diluted, Excluding EI&DO
2.430
2.670
.070
2.700
2.970
EPS – Fully Diluted, Including EI&DO
2.430
2.670
.070
2.700
2.970
1,241.153
1,208.163
1,199.927
1,199.990
1,166.000
1,259.252
1,226.519
1,214.703
1,215.591
1,178.000
1,217.183
1,199.100
1,204.698
1,181.189
1,155.438
2018
2019
2020
2021
2022
(31JAN2021 )
(31JAN2022 )
(31JAN2023 )
4,749.112
4,367.471
4,821.803
Available for Common Before EI&DO
Common Stock Equivalents – Savings
Adjusted Available for Common
EARNINGS PER SHARE
COMMON SHARES
Common Shares for Primary EPS
Calculation
Common Shares for Fully Diluted EPS Calc.
Common Shares Outstanding at Fiscal Yr
End
STATEMENT OF RETAINED EARNINGS
Fiscal Year:
(FYR Ending):
(31JAN2019 ) (31JAN2020 )
Retained Rearnings – Beginning Balance
4,520.300
3,831.423
Net Income
3,059.798
3,272.193
90.470
3,282.815
3,498.000
922.596
1,071.562
278.256
1,251.833
1,339.000
6,657.502
6,032.054
4,561.326
6,398.453
6,980.803
Adj. to Long-Term Marketable Securities
.000
.000
.000
.000
.000
Other CMP Adj,(Stock Splits/Retirement)
Non-Compustat Adjustments (Plug
Calculation)
-177.144
-216.051
-164.539
-198.903
-62.000
-2,648.935
-1,066.891
-29.316
-1,377.747
-1,709.803
Retained Earnings – Ending Balance
3,831.423
4,749.112
4,367.471
4,821.803
5,209.000
.000
.000
.000
.000
.000
Cash Dividends
Retained Earnings After Dividends
Change – Foreign Currency Translation
Retroactive Adjustments (Acct’g Chgs)
Retained Earnings – After Adjustments
3,831.423
4,749.112
4,367.471
4,821.803
5,209.000
2018
2019
2020
2021
2022
(31JAN2021 )
(31JAN2022 )
(31JAN2023 )
STATEMENT OF CASH FLOWS
Fiscal Year:
(FYR Ending):
(31JAN2019 ) (31JAN2020 )
INDIRECT OPERATING ACTIVITIES
Income Before Extraordinary Items
3,059.798
3,272.193
90.470
3,282.815
3,498.000
Depreciation and Amortizations
819.655
867.303
870.758
868.002
887.000
.000
.000
.000
.000
.000
-88.594
-6.233
-230.690
-44.450
64.000
.000
.000
Extraordinary Items and Disc. Operations
Deferred Taxes
Equity in Net Loss (Earnings)
Sale of PPEq and Investments – Loss (Gain)
Funds from Operations – Other
141.624
77.336
411.704
424.689
456.000
Receivables – Decrease (Increase)
-23.532
-42.998
-71.091
-61.452
-51.000
Inventory – Decrease (Increase)
-465.429
-296.541
588.756
-1,657.753
58.000
Income Taxes – Accrued – Increase(Decrease)
40.965
-128.342
52.791
99.682
-126.000
Other Assets and Liabilities – Net Change
603.972
323.822
2,849.191
145.952
-702.000
4,088.459
4,066.540
4,561.889
3,057.485
4,084.000
.000
230.156
.000
.000
.000
Accounts/P and Accrued Liabs – Inc(Dec)
Operating Actiities – Net Cash Flow
INVESTING ACTIVITIES
Investments – Increase
Sale of Investments
.000
.000
.000
.000
.000
474.935
-16.118
-10.576
-1.592
-13.000
1,125.139
1,223.116
568.021
1,044.794
1,457.000
Sale of Property Plant and Equipment
.000
.000
.000
.000
.000
Acquisitions
.000
.000
.000
.000
.000
26.652
7.419
.000
.000
.000
-623.552
-1,461.971
-578.597
-1,046.386
-1,470.000
255.241
232.106
211.189
229.439
321.000
2,423.011
1,575.415
230.809
2,201.846
2,255.000
922.596
1,071.562
278.256
1,251.833
1,339.000
Long Term Debt – Issuance
.000
.000
5,986.873
.000
.000
Long Term Debt – Reduction
7.115
.000
2,418.358
2,975.518
.000
Short term Investments – Change
Capital Expenditures
Investing Activities – Other
Investing Activites – Net Cash Flow
FINANCING ACTIVITIES
Sale of Common and Preferred Stock
Purchase of Common and Preferred Stock
Cash Dividends
Current Debt – Changes
.000
.000
Financing Activities – Other
.000
.000
-42.377
.000
-33.000
-3,097.481
-2,414.871
3,228.262
-6,199.758
-3,306.000
Exchange Rate Effect
-95.674
-3.175
41.264
-54.146
-58.000
Cash and Cash Equivalents – Change
271.752
186.523
7,252.818
-4,242.805
-750.000
Interest Paid – Net< 64.007 56.322 153.045 138.733 86.000 Income Taxes Paid 1,147.511 1,280.680 146.008 1,118.879 1,225.000 2018 2019 2020 2021 2022 (31JAN2021 ) (31JAN2022 ) (31JAN2023 ) Financing Activities - Net Cash Flow .000 OTHER INFORMATION ADDITIONAL SCHEDULES Fiscal Year: (FYR Ending): (31JAN2019 ) (31JAN2020 ) Receivables - Trade 346.298 386.261 461.139 517.623 563.000 Income Tax Refund .000 .000 36.262 114.537 119.000 Receivables - Other - Current .000 .000 .000 .000 .000 346.298 386.261 497.401 632.160 682.000 Inventories - Raw Materials .000 .000 .000 .000 .000 Inventories - Work In Process .000 .000 .000 .000 .000 Inventories - Finished Goods Receivables - Total (Net) 4,579.033 4,872.592 4,337.389 5,961.573 5,819.000 Inventories - Other .000 .000 .000 .000 .000 Inventories - Total 4,579.033 4,872.592 4,337.389 5,961.573 5,819.000 LESS: Debt (Long Term) Due In One Year .000 -1,411.216 -2,427.289 -1,576.561 -2,110.000 Debt - Convertible Subordinated .000 .000 .000 .000 .000 Debt - Senior Convertible .000 .000 .000 .000 .000 Debt - Subordinated Debt - Notes Debt - Debentures Debt - Long Term - Other Debt - Capitalized Lease Obligations Long Term Debt Total Property, Plant and Equipment (Cost) Beginning Balance .000 .000 .000 .000 .000 2,233.616 2,236.625 5,332.921 3,354.841 2,859.000 .000 .000 .000 .000 .000 .000 7,816.633 7,743.216 7,575.590 7,775.000 243.258 .000 .000 .000 .000 2,476.874 10,053.258 13,076.137 10,930.431 10,634.000 Capital Expenditures 1,125.139 1,223.116 568.021 1,044.794 1,457.000 10,729.119 20,432.610 20,752.823 21,289.560 22,403.000 5,473.911 6,047.230 6,726.729 7,164.799 7,534.000 Retirements Other Changes Ending Balance Accumulated Depreciation on PPE Beginning Balance Depreciation Expense Depletion Expense Retirements Other Changes Ending Balance Deferred Taxes - Federal -62.278 9.409 -97.705 -32.562 52.000 Deferred Taxes - Foreign 2.274 -7.615 -109.181 14.073 12.000 Deferred Taxes - State -27.831 -8.203 -25.406 -25.723 .000 Income Taxes - Federal 711.369 708.508 189.854 766.200 656.000 Income Taxes - Foreign 238.692 181.061 4.985 122.325 185.000 Income Taxes - State 251.187 250.830 36.246 270.480 233.000 Income Taxes - Other .000 .000 .000 .000 .000 Income Taxes - Total 1,113.413 1,133.990 -1.207 1,114.793 1,138.000 2018 2019 2020 2021 2022 (31JAN2021 ) (31JAN2022 ) (31JAN2023 ) Common Shares Reserved For Conversion Convertible Debt Preferred Stock Stock Options Warrants and Other Total ADDITIONAL DATA Fiscal Year: (FYR Ending): (31JAN2019 ) (31JAN2020 ) Acquisitions - Income Contribution Acquisitions - Sales Contribution Adjustmnet Factor-Cum, Ex-Date Advertising Expense Average Short Term Borrowing Rate Average Short term Borrowing 1.000 1.000 1.000 1.000 1.000 446.300 452.000 296.000 506.000 500.000 Common Shareholders (# of) Common Shares Traded (Calendar Yr) 2.196 2.095 2.045 1.984 1.933 ########### ############ ############## ############## ############## Compensating Balance Convertible Debt and Preferred Stock .000 .000 .000 .000 .000 Debt (Long Term) Maturing Due in 2 Years .000 750.000 .000 500.000 .000 Debt (Long Term) Maturing Due in 3 Years Debt (Long Term) Maturing Due in 4 Years Years 750.000 .000 500.000 .000 .000 .000 500.000 .000 .000 1,000.000 Debt (Long Term) Maturing Due in 5 Years 500.000 .000 1,250.000 1,000.000 .000 .000 .000 .000 .000 243.258 .000 .000 .000 .000 Debt - Unamortized Debt Discount and Other .000 .000 .000 .000 .000 Dividends (Cash)per Share Ex-Date .741 .885 .230 1.040 1.145 Dividends (Cash) - Common 965.539 1,111.788 311.970 1,248.037 1,373.000 Dividends (Cash) - Preferred .000 .000 .000 .000 .000 270.000 286.000 320.000 340.000 329.000 14,326.029 24,145.003 30,813.555 28,461.458 28,349.000 -453.177 -457.120 -441.532 -488.247 -544.000 4.263 2.314 5.384 3.684 7.000 .000 .000 .000 .000 .000 LIFO Reserve .000 .000 .000 .000 .000 Order Backlog .000 .000 .000 .000 .000 Preferred Stock - Dividends In Arrears .000 .000 .000 .000 .000 Preferred Stock - Liquidation Value .000 .000 .000 .000 .000 Preferred Stock - Redemption Value .000 .000 .000 .000 .000 Debt - Long-Term Debt - Tied to Prime Debt - Martgages and Other Securities Employees (# of) Equity in Earnings - Unconsolidated Subs Foreign Currency Translation Adj - Bal. Sheet Foreign Currency Translation Adj - Inc. Stmnt. Interest Capitalized (in fiscal yr) Interest Capitalized - Net Income Effect Interest Expense on Long Term Debt Investment Tax Credit Labor Related Expenses Present Value - Noncapitalized Leases 3,377.045 12,601.745 12,558.827 12,506.214 12,960.000 Price - Calendar Year Close 44.740 61.060 68.290 75.920 79.600 Price - Calendar Year High 56.640 61.690 68.890 76.940 81.165 Price - Calendar Year Low 36.410 43.800 32.720 61.150 53.690 Price - Fiscal Year Close 49.730 59.040 64.040 71.970 81.860 Rental Commitments - Minimum Year+1 1,676.700 1,781.208 2,049.652 1,911.459 1,977.000 Rental Commitments - Minimum Year+2 1,603.378 1,667.836 1,741.490 1,765.056 1,825.000 Rental Commitments - Minimum Year+3 1,441.444 1,511.599 1,559.123 1,551.319 1,628.000 Receivables - Estimated Doubtful Rental Commitments - Minimum Year+4 1,253.420 1,327.875 1,331.267 1,329.031 1,402.000 Rental Commitments - Minimum Year+5 1,042.184 1,100.887 1,087.555 1,076.816 1,111.000 Rental Expense 1,701.200 2,978.838 2,983.367 3,292.379 3,286.000 Rental Income 1.200 Research and Development Expense .000 .000 .000 .000 .000 272.000 346.700 850.000 825.000 836.000 Treasury Stock ($) - Common .000 .000 .000 .000 .000 Treasury Stock ($) - Preferred .000 .000 .000 .000 .000 Treasury Stock - # Shares .000 .000 .000 .000 .000 Tax Loss Carry Forward INPUTS INTO FINANCIAL STATEMENTS AND MARKET RELATIONS Fiscal Year: (FYR Ending): Cash & Equivalents Receivables - Total (Net) Inventories - Total 2018 2019 (31JAN2019 ) (31JAN2020 ) 3,030.229 3,216.752 2020 2021 2022 (31JAN2021 ) (31JAN2022 ) (31JAN2023 ) 10,469.570 6,226.765 5,477.000 346.298 386.261 497.401 632.160 682.000 4,579.033 4,872.592 4,337.389 5,961.573 5,819.000 Prepaid Expenses Current Assets - Other 513.662 415.017 434.977 438.099 478.000 Current Assets - Total 8,469.222 8,890.622 15,739.337 13,258.597 12,456.000 Plant, Property & Equip (Gross) 10,729.119 20,432.610 20,752.823 21,289.560 22,403.000 Accumulated Depreciation 5,473.911 6,047.230 6,726.729 7,164.799 7,534.000 Plant, Property & Equip (Net) 5,255.208 14,385.380 14,026.094 14,124.761 14,869.000 Investments at Equity .000 225.000 196.000 186.000 186.000 Investments and Advances - Other .000 .000 .000 .000 .000 235.499 228.911 224.446 219.543 217.000 Intangibles Deferred Charges .000 .000 .000 .000 .000 Assets - Other 366.100 415.090 627.678 672.557 621.000 TOTAL ASSETS 14,326.029 24,145.003 30,813.555 28,461.458 28,349.000 Accounts Payable 2,644.143 2,672.557 4,823.397 4,465.427 3,794.000 .000 .000 .000 .000 .000 Notes Payable Accrued Expenses Taxes Payable 154.155 24.700 81.523 181.155 55.000 .000 1,411.216 2,427.289 1,576.561 2,110.000 Other Current Liabilities 2,733.076 3,041.774 3,471.459 4,244.997 4,346.000 Total Current Liabilities 5,531.374 7,150.247 10,803.668 10,468.140 10,305.000 Long Term Debt 2,476.874 10,053.258 13,076.137 10,930.431 10,634.000 158.191 142.170 37.164 44.175 127.000 .000 .000 .000 .000 .000 Liabilities - Other 1,110.984 851.116 1,063.902 1,015.720 919.000 TOTAL LIABILITIES 9,277.423 18,196.791 24,980.871 22,458.466 21,985.000 Debt (Long-Term) Due In One Year Deferred Taxes (Balance Sheet) Investment Tax Credit Noncontrolling Interest - Redeemable .000 .000 .000 .000 .000 Preferred Stock .000 .000 .000 .000 .000 Common Stock 1,217.183 1,199.100 1,204.698 1,181.189 1,155.000 Capital Surplus .000 .000 260.515 .000 .000 3,831.423 4,749.112 4,367.471 4,821.803 5,209.000 .000 .000 .000 .000 .000 5,048.606 5,948.212 5,832.684 6,002.992 6,364.000 .000 .000 .000 .000 .000 TOTAL SHAREHOLDERS EQUITY 5,048.606 5,948.212 5,832.684 6,002.992 6,364.000 Sales (Net) 38,972.934 41,716.977 32,136.962 48,549.982 49,936.000 Cost of Goods Sold 27,012.277 28,978.477 23,341.057 33,872.810 35,262.000 Gross Profit 11,960.657 12,738.500 8,795.905 14,677.172 14,674.000 Selling, General, & Admin Expenses 6,923.564 7,454.988 7,454.917 9,295.238 8,927.000 Operating Income Before Depreciation 5,037.093 5,283.512 1,340.988 5,381.934 5,747.000 Retained Earnings (Net Other) Less: Treasury Stock Shareholders Equity - Parent Noncontrolling Interest - Nonredeemable Depreciation, Depletion, & Amortization 818.900 867.303 870.758 868.002 887.000 4,218.193 4,416.209 470.230 4,513.932 4,860.000 69.102 61.400 199.038 123.196 91.000 Non-Operating Income/Expense 60.242 51.374 18.304 8.120 85.000 Special Items -36.122 .000 -200.233 -1.248 -218.000 Pretax Income 4,173.211 4,406.183 89.263 4,397.608 4,636.000 Income Taxes - Total 1,113.413 1,133.990 -1.207 1,114.793 1,138.000 .000 .000 .000 .000 .000 3,059.798 3,272.193 90.470 3,282.815 3,498.000 Extraordinary Items .000 .000 .000 .000 .000 Discontinued Operations .000 .000 .000 .000 .000 Net Income (Loss) 3,059.798 3,272.193 90.470 3,282.815 3,498.000 Preferred Dividends .000 .000 .000 .000 .000 EPS - Primary - Excluding EI&DO 2.470 2.710 .080 2.740 3.000 EPS - Primary - Including EI&DO 2.470 2.710 .080 2.740 3.000 EPS - Fully Diluted - Excluding EI&DO 2.430 2.670 .070 2.700 2.970 EPS - Fully Diluted - Including EI&DO 2.430 2.670 .070 2.700 2.970 SHARES - for Primary EPS Calculation 1,241.153 1,208.163 1,199.927 1,199.990 1,166.000 SHARES - for Fully Diluted EPS Calculation 1,259.252 1,226.519 1,214.703 1,215.591 1,178.000 SHARES - Outstanding at Fiscal Year End 1,217.183 1,199.100 1,204.698 1,181.189 1,155.438 Operating Activities - Net Cash Flow 4,088.459 4,066.540 4,561.889 3,057.485 4,084.000 Capital Expenditures Operating Income After Depreciation Interest Expense Minority Interest INCOME BEFORE EI&DO STATEMENT OF CASH FLOWS 1,125.139 1,223.116 568.021 1,044.794 1,457.000 Sale of Property Plant and Equipment .000 .000 .000 .000 .000 Acquisitions .000 .000 .000 .000 .000 Investing Activites - Net Cash Flow -623.552 -1,461.971 -578.597 -1,046.386 -1,470.000 Cash Dividends 922.596 1,071.562 278.256 1,251.833 1,339.000 CASH STATEMENT - SOURCE & USE Interest Paid - Net 64.007 56.322 153.045 138.733 86.000 Income Taxes Paid 1,147.511 1,280.680 146.008 1,118.879 1,225.000 .000 .000 Funds From Operations - Total Current Debt - Changes .000 Working Capital Changes - Other - Inc(Dec) Adjustmnet Factor-Cum, Ex-Date 1.000 1.000 1.000 1.000 1.000 446.300 452.000 296.000 506.000 500.000 .741 .885 .230 1.040 1.145 Dividends (Cash) - Common 965.539 1,111.788 311.970 1,248.037 1,373.000 Dividends (Cash) - Preferred .000 .000 .000 .000 .000 Preferred Stock - Liquidation Value .000 .000 .000 .000 .000 Advertising Expense Dividends (Cash)per Share Ex-Date Preferred Stock - Redemption Value .000 .000 .000 .000 .000 Price - Calendar Year Close 44.740 61.060 68.290 75.920 79.600 Price - Fiscal Year Close 49.730 59.040 64.040 71.970 81.860 1,701.200 2,978.838 2,983.367 3,292.379 3,286.000 .000 .000 .000 .000 .000 Receivables - Estimated Doubtful Rental Expense Research and Development Expense Beneish Model for Most Recent Fiscal Year Value 2023 Intercept ( N/A ) DSRI GMI AQI SGI DEPI SAI LVGI TATA Coefficient 1.048897 1.028771 0.953587 1.028548 1.028398 0.933728 0.982405 -0.02067 Value x Coefficient -4.84 0.920 0.528 0.404 0.892 0.115 -0.172 -0.327 4.679 M-Score Probability of Manipulation 0.96 0.54 0.39 0.92 0.12 -0.16 -0.32 -0.10 -2.489411106 0.64% 2023 ( N/A ) 2023 ( N/A ) 2023 ( N/A ) 2023 ( N/A ) 2023 ( N/A ) 2023 ( N/A ) Assignment 2 Use the Excel file “Assignment2Data” to complete this assignment. The file contains the following variables of interest from 10-Ks filed by retailers for their fiscal years from 2019 – 2023 (the most recent 5 years available): act = current assets rect = receivables at = total assets revt = sales cogs = cost of goods sold conm = company name ib = income from continuing operations tic = ticker symbol invt = inventory fiscal_year = fiscal year oancf = cash flow from operations fiscal_year_end = fiscal year end date au = auditor (see AU – Auditor sheet for translation of values) auop = auditor opinion (see AUOP – Opinion sheet for translation of values) auopic = auditor opinion over internal controls (see AUOPIC – Internal Controls sheet for translation of values) Financial statement amounts are in millions of dollars. Part 1. Potential Red Flags - Related to Auditor and Audit Opinion Use the Data spreadsheet, the AU – Auditor, the AUOP – Opinion, and the AUOPIC – Internal Controls spreadsheets in the Assignment2Data Excel file. 1. Who was the auditor for your company during the last year (fiscal year = 2023)? 2. Has your company had a different auditor for any of the other years? If yes, who was the other auditor and what years were they the auditor? 3. What was the auditor’s opinion for your company during the last year (fiscal year = 2023)? 4. What was the auditor’s opinion over internal controls for your company during the last year (fiscal year = 2023)? 5. In what year did the auditor begin serving the company (find this in the audit report from the most recent 10-K)? 6. Did the auditor mention any critical audit matters in the audit report? If yes, briefly describe the issue or issues mentioned. Part 2. Potential Red Flags – Graphs Use the Data spreadsheet in the Assignment2Data Excel file and the formulas from the PowerPoint slides. 7. Create a plot that shows your company’s Average Days to Collect Receivables by year as a line graph. Copy and paste your graph. 1 8. Create a plot that shows your company’s Average Days to Sell Inventory by year as a line graph. Copy and paste your graph. 9. Create a plot that shows your company’s Long-term Asset Turnover by year as a line graph. Copy and paste your graph. 10. Create a plot that shows your company’s Accruals by year as a line graph. Copy and paste your graph. Part 3. Potential Red Flags – Beneish Earnings Manipulation Model Use the Beneish Model spreadsheet in the Assignment2Data Excel file. 11. What is your company’s Beneish M-score for their most recent fiscal year? What is your company’s probability of manipulation for that year? If your company has zero receivables, you will get an error. To fix this problem, enter the value 1 in cell L10. 2 Module 4 – Accounting Analysis Part 2: Managers’ Incentives to Bias Accounting Managers’ Incentives to Bias Accounting • Managers’ Incentives to Bias Accounting Upwards (e.g., report higher net income or higher assets): – Accounting-based debt covenants • Lending agreements with banks and other debt holders require firms to meet covenants based on accounting numbers (e.g., interest coverage, working capital ratios, and net worth). • Violation of covenants can trigger penalties and require repayment of loan. – Management compensation and reputation/job security • Managers’ compensation is tied to the firm’s profits and stock price through: – Bonuses – Stock and/or stock option grants • Manager’s reputation, job security, and future job opportunities are also tied to the firm’s profits and stock price. – Capital market considerations • Managers can bias accounting to keep profits up and therefore keep the stock price up. They may want to keep the stock price up because they plan to: – Raise capital (issue equity and/or debt) – Sell their shares and/or exercise their stock options Managers’ Incentives to Bias Accounting • Managers’ Incentives to Bias Accounting Downwards (e.g., report lower net income or lower assets): – Competitive considerations • Firms can discourage competitors by reporting lower profits. – To show higher profits in a future period • Bias accounting downwards (e.g., shift future expenses to current year) in a good year to smooth earnings. • Bias accounting downwards (e.g., write-down assets more than necessary) in very bad year (sometimes called taking a “big bath”) to show a sharper turnaround the following year. – Tax considerations • Lower profits can result in lower taxes. – Regulatory considerations • High profits can draw the attention of regulators (e.g., antitrust actions and tax policies). • Lower profits can result in higher import tariffs on foreign competitors. – Stakeholder considerations • Unions can use high profits to demand wage increases. Managers’ Incentives to Bias Accounting From: Dechow and Schrand (2004) Managers’ Incentives to Bias Accounting • Managers care about reporting earnings per share (EPS) that is greater than: – 1. Zero – 2. EPS from the same quarter last year – 3. Analysts’ consensus forecast of EPS • Failure to meet these earnings benchmarks can result in a significant decrease in stock price. Managers’ Incentives to Bias Accounting • Earnings Management to Exceed Zero From: Burgstahler and Dichev (1997) Managers’ Incentives to Bias Accounting • Earnings Management to Exceed Last Year From: Degeorge, Patel, and Zeckhauser (1999) Managers’ Incentives to Bias Accounting • Earnings Management to Exceed the Analysts’ Consensus Forecast From: Degeorge, Patel, and Zeckhauser (1999) Module 4 – Accounting Analysis Part 3: Potential Red Flags Potential Red Flags • Changes in auditor • Could indicate that the firm has “opinion shopped” • Non-Big Four auditor • Big Four auditor usually viewed as higher quality • Qualified audit opinion • Indicates that the auditor has found a problem • Ineffective internal controls • See auditor’s report on internal controls Potential Red Flags • Unusual increases in receivables in relation to sales • Could indicate “channel stuffing” • Sending large shipments to customers near the end of the quarter or year. • May result in future returns or reduced sales in the next period. • Could indicate understating allowance for uncollectible accounts and the relaxing of credit policies • May result in receivable write-offs. – Warnings signs: 𝑆𝑎𝑙𝑒𝑠 𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒𝑠 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 = 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒𝑠 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐷𝑎𝑦𝑠 𝑡𝑜 𝐶𝑜𝑙𝑙𝑒𝑐𝑡 𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒𝑠 = 365 𝑆𝑎𝑙𝑒𝑠 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒𝑠 Note: “Average” means the average of the beginning and ending balances. Potential Red Flags • Unusual increases in inventory in relation to sales • Could indicate a decrease in demand • May force firm to cut prices to sell the inventory • May force firm to write-down inventory • lower of cost or market rule – LCM (LIFO and Retail Inv. Methods) • lower of cost or net realizable value rule – LCNRV • Warnings signs: 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 = 𝐶𝑜𝑠𝑡 𝑜𝑓 𝐺𝑜𝑜𝑑𝑠 𝑆𝑜𝑙𝑑 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐷𝑎𝑦𝑠 𝑡𝑜 𝑆𝑒𝑙𝑙 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 = 365 𝐶𝑜𝑠𝑡 𝑜𝑓 𝐺𝑜𝑜𝑑𝑠 𝑆𝑜𝑙𝑑 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 Potential Red Flags • Decrease in productivity of PP&E – Could indicate impaired PP&E – Warning sign: 𝑆𝑎𝑙𝑒𝑠 𝑃𝑃&𝐸 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 = 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑁𝑒𝑡 𝑃𝑃&𝐸 • Decrease in productivity of long-term assets – Could indicate overpayment for or the unsuccessful integration of key acquisitions (i.e., overstated goodwill) – Warning signs: 𝑆𝑎𝑙𝑒𝑠 𝐿𝑜𝑛𝑔 𝑡𝑒𝑟𝑚 𝐴𝑠𝑠𝑒𝑡 𝑇𝑢𝑟𝑛𝑜𝑣𝑒𝑟 = 𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐿𝑜𝑛𝑔 𝑡𝑒𝑟𝑚 𝐴𝑠𝑠𝑒𝑡𝑠 Potential Red Flags • Increasing gap between reported income and cash flow from operating activities (i.e., increase in accruals) • Accruals = (Income from Continuing Operations – Cash Flow from Operations) / Total Assets • High accruals may indicate aggressive accrual estimates From: Richardson, Tuna, and Wu (2003) Module 4 – Accounting Analysis Part 4: Beneish Earnings Manipulation Model Beneish Model • Beneish Earnings Manipulation Model – model that uses financial statement information to predict earnings manipulation M-score = -4.84 + .920(DSRI) + .528(GMI) + .404(AQI) + .892(SGI) + .115(DEPI) - .172(SAI) - .327(LVGI) + 4.679(TATA) • Lower M-Score implies lower probability of manipulation • Higher M-Score implies higher probability of manipulation Beneish Model • Beneish Model Variables: • DSRI = (Receivablest/Salest)/(Receivablest-1/Salest-1) – • GMI = [(Salest-1 – COGSt-1)/ Salest-1] / [(Salest – COGSt)/ Salest] – • Measures whether receivables as a proportion of sales in the current year are greater than last year. Suggests a relaxing of credit policy and/or the inflation of revenues. May indicate overstated revenues and earnings. Measures the change in Gross Profit Margin. Values of GMI greater than 1 indicate a deterioration. Suggests worsening situation for the firm. Firms with poor prospects may be more likely to manipulate. AQI = [1 – ((Current Assetst + PPEt)/Total Assetst)] / [1 – ((Current Assetst-1 + PPEt-1)/Total Assetst-1)] - Measures the quality of a firm’s assets. The idea being that the future benefits to noncurrent assets other than PP&E are more uncertain (e.g., intangible assets). • SGI = Salest / Salest-1 – Measures sales growth. Growth does not imply manipulation, but quickly growing firms have greater pressures to meet earnings targets and therefore are more likely to manipulate. Beneish Model • Beneish Model Variables (continued): • DEPI = [Depreciationt-1/(Depreciationt-1 + Net PPEt-1)] / [Depreciationt/(Depreciationt + Net PPEt)] - Measures the change in the depreciation rate. Values greater than 1 indicates that the depreciation rate has decreased. Suggests that the firm has revised upward its assets’ useful lives or that the firm has changed depreciation method to an income increasing method. • SAI = (SG&At / Salest) / ( SG&At-1 / Salest-1) – • Measures the change in SG&A as a proportions of sales. Similar to the SGI variable, an increase in SG&A suggests an increase in future sales and a greater incentive to manipulate. LVGI = [(Long Term Debtt + Current Liabilitiest)/ Total Assetst] / [(Long Term Debtt-1 + Current Liabilitiest-1)/ Total Assetst-1] - Measures the change in leverage. Values greater than 1 indicate increases in leverage. Increases in leverage are likely to be associated with increased pressure to manipulate due to debt covenants. • TATA = (Income from Continuing Operationst – Cash Flow from Operationst) / Total Assetst – Measures the amount of accruals in the current year. Accruals are easier to manipulate than cash. Beneish Model Beneish Earnings Manipulation Model Enron Example Enron Value (amounts in millions) 2000 1999 Accounts Receivable 10396 3030 Current Assets 30381 7255 PP&E 11743 10681 Total Assets 65503 33381 Current Liabilities 28406 6759 Long-Term Debt 8550 Sales Coefficient Value * Coefficient Intercept -4.840 DSRI 1.365 0.920 1.256 GMI 2.144 0.528 1.132 AQI 0.771 0.404 0.312 SGI 2.513 0.892 2.241 7151 DEPI 1.267 0.115 0.146 100789 40112 SAI 0.416 -0.172 -0.072 COGS 94517 34761 LVGI 1.354 -0.327 -0.443 SG&A Income from Continuing Operations 3184 3045 TATA -0.058 4.670 -0.271 979 1024 M-score = -0.538 Cash Flow from Operations 4779 1228 Depreciation Expense 485 565 Probability of Manipulation = 29.51%