Reference no: EM132475249

Point 1: Fiscal year end is quickly approaching at AVC. With the looming decision of whether or not to proceed with the IPO (Initial Public Offering) it has become increasingly critical that the year-end financial statements are relevant and reliable, and truly reflect the current financial position of the organization. Neela and Rupinder have been under great pressure to ensure that these statements are in proper form and are highly useful for the Chan family to make their decision. The interpretation of these statements will determine whether the company remains private or goes public. One of the greatest concerns stems from the previous year end financial report that was prepared. Unfortunately, Neehla was on vacation and Rupinder had a family emergency and neither was available when the previous senior accountant prepared the financials. The Chan family was extremely disappointed with the level of information that was provided and the inability to use the information to make any solid business decisions at that time. They have voiced their concern and warned that the current year-end financials are to be up to standard.

Point 2: Appendix A (located in Slate) is the package that was presented for the previous year end, exactly as shown. The associates sent out the presentation as a word document. As the accounting team now responsible for compiling the financial statements for distribution and presentation to Senior Management of AVC, you are required to analyze the previous submission and make the necessary changes to the current year-end package to ensure there is not a repeat. Begin by reviewing the appendix for format, content, comprehension etc. Rupinder and Neehla have asked you to advise on the following via email:

Question 1: discuss the challenges that users of the financial statements face with poorly prepared reports. Identify more than 1 user.

Question 2: Discuss the value of using comparative financial statements when distributing financial reports

Question 3: Discuss the importance of the aging schedules, and how they can be relatable to the decision to go public as a means of obtaining cash from outside the company.