Mercedes Financial Statement Recasting
Mercedes Financial Statement Recasting
(Mercedes Financial Statement Recasting)
mercedez benz consolidated financial statements paper
Option #1: Mercedes Benz (MB)
Read the Mercedes Benz (MB)’s 2016 Annual Report prepared under IFRS., by clicking here. Pick any two of the financial statements:
- the consolidated balance sheet (statement of financial position)
- the consolidated income statement (statement of income or statement of comprehensive income)
- the statement of cash flows for MB.
Recast the two selected financial statements and present the statements following/in accordance with the US GAAP, presentation-wise, as accurately as you can. (You do not need to restate any of the results for MB in this process–just work with the results as presented.) The recasted financial statements should be an Exhibit or Appendix to your paper. Describe, in an appropriate level of detail, the differences that resulted when you recasted your chosen financial statements from the IFRS to US GAAP, supported with references from the readings in this module or outside references, where appropriate.
- Your paper should be 3 pages in length (not including the required cover and reference pages and excluding the required Exhibits or Appendices showing the recasted financial statements). Written submissions in excess of 4 pages are acceptable.
- Be sure to discuss and reference concepts taken from the assigned module readings and relevant research. You must include a minimum of three credible, academic, or professional references supporting your submission and work.
(Mercedes Financial Statement Recasting)
1. Introduction
- Briefly introduce Mercedes Benz and the purpose of financial statement analysis.
- Mention the focus on the 2016 Annual Report and the shift from IFRS to US GAAP for comparative presentation.
- State which two statements you chose (e.g., balance sheet and income statement) and the importance of understanding differences between IFRS and US GAAP.
2. Selected Financial Statements under IFRS vs. US GAAP
- Provide a short summary of the two selected financial statements (e.g., balance sheet and income statement) in their original IFRS form.
- Mention any key figures, such as total assets, liabilities, income, or other major line items.
3. Recasting the Financial Statements: Presentation under US GAAP
- Recast both statements using US GAAP presentation format. This doesn’t involve changing actual numbers, just rearranging the format to comply with US GAAP.
- For the balance sheet, note the order of liquidity differences. Under IFRS, assets/liabilities can be in non-current/current order, while US GAAP requires current assets/liabilities first.
- For the income statement, describe the comprehensive income approach and note any specific line-item requirements unique to US GAAP, such as separating operating income from non-operating items more explicitly.
4. Key Differences between IFRS and US GAAP
- Balance Sheet Differences: Describe any line item relocations or terminology adjustments between IFRS and US GAAP.
- Income Statement Differences: Describe presentation differences in income and expenses (e.g., treatment of extraordinary items, income from continuing vs. discontinued operations).
- Other Presentation Differences: Identify any notes or disclosures that are more prominent in one standard than the other.
5. References to Relevant Literature
- Integrate information from your assigned readings and other resources that clarify the differences between IFRS and US GAAP.
- Ensure at least three credible references are cited, discussing standard differences or specifics related to balance sheet and income statement presentations.
6. Conclusion
- Summarize the importance of understanding IFRS and US GAAP differences, especially in an international context.
- Reflect on any insights gained from recasting the statements and potential implications for investors comparing financials across standards.
7. Appendix/Exhibits
- Include the recasted balance sheet and income statement as appendices to illustrate the formatting changes made to comply with US GAAP.
References
- Ensure your reference list includes assigned readings and other sources that helped you explain the IFRS vs. GAAP differences.
