Western Bank Financial Statement Analysis

Analysis of the Western Bank Financial Statement
Ernst & Young Auditing
2009 Angelbert D. Morales

I. Introduction
Western Bank is a financial institution with 40,000 account holders and with 15 different branches. Its main location can be found in Southwestern Ontario. It also has 20 different types of deposit account and 20 type of loan.
In order to verify the reasonableness of some of the numbers reported in Western financial statements. The researcher scrutinized the informational data. This is to investigate the lapses of the computed data done by the Western Bank.

The researcher calculated the total interest income by multiplying the interest rate on each type of loan and the loan balance. Then summed over all type of loans and summed over all time periods.

Likewise, the informational data will give the Western Bank manager a broader level of understanding on the computation of the total interest income per month and even per year.

Conclcusion Large: Equity Valuation using accounting numbers

Large sample

In this paper, the researcher empirically examined also the success of multiple regression model. The researcher investigated if the Assets turnover, Profit margin, Equity Multiplier, and Return on total assets have no effect on the Equity Valuation from the informational data of LUVLE course website: https://luvle.lancs.ac.uk/Acfin/703.nfs. The researcher also used Frequency distribution and analysis of variance (ANOVA).

This paper examined the informational data of LUVLE course website: https://luvle.lancs.ac.uk/Acfin/703.nfs. The researcher discovered that the Assets turnover, Profit margin, Equity Multiplier, and Return on total assets have significant effect on the Return on Equity from the informational data of LUVLE course website.

This means that other variables can affect the result of the equity valuation. The researcher suggested the additional parameters for the greater accuracy of the model.

Conclusion-small: Equity Valuation using accounting numbers

VII. CONCLUSION:
Small sample
In this paper, the researcher empirically examined the success of multiple regression model. The researcher investigated if the R&D to Total Assets, Intangibles to Total Assets, Assets turnover, Profit margin, Equity Multiplier, and Return on total assets have no effect on the Equity Valuation from the informational data of LUVLE course website: https://luvle.lancs.ac.uk/Acfin/703.nfs. The researcher also used Frequency distribution and analysis of variance (ANOVA).
This paper examined the informational data of LUVLE course website: https://luvle.lancs.ac.uk/Acfin/703.nfs. The researcher discovered that the R&D to Total Assets, Intangibles to Total Assets, Assets turnover, Profit margin, Equity Multiplier, and Return on total assets have an effect on the Equity Valuation from the informational data of LUVLE course website. This means that other variables can affect the flaws of the equity valuation. The researcher suggested the additional parameters for the greater accuracy of the model.

Results: Equity Valuation using accounting numbers

VI. RESULTS
Small sample
This section presents the analysis of the data on the study to find out if the R&D to Total Assets, Intangibles to Total Assets, Assets turnover, Profit margin, Equity Multiplier, and Return on total assets have an effect on the Equity Valuation. The Multiple Regression model was used to examine the effect of the other values to the equity valuation using LUVLE course website informational data. The descriptive statistics was also used in this study for the presentation purposes. Graphs 1 to 2 show the inflation of the elasticity of the variables.

The statistical informational data was from LUVLE course website: https://luve.lancs.ac.uk/Acfin/703.nfs.
Graph 1 above shows that out of 25, only 6 companies have a high R & D Range. The Firm number 6 got the highest inflation of R & D value which range between 150,000,000 and followed by Firm 5 and Firm 2, range near 50,000,000. The fourth firm who got R & D lower than 50,000,000was Firm 4. This implies that there were only few Firms who focused on the R & D. This means that many Firms were afraid to gamble or to take the risk in spending too much in Research and Development (R & D). This also shows that even though Firms belong to above £ 10,000 R & D, there were still other factors that can affect the interest of the investors.

Equity Valuation using accounting numbers

CHAPTER-3: METHODOLOGY
3-1 Research Methodology

The main objective of this chapter is to identify how the chosen research methodologies that will match the main objective of the dissertation question and how it will be achieved. Given the two types of research methodology between qualitative and quantitative research, this paper has to make a choice of one over the other or a combination of both. This paper admits that the quantitative research is carried out through obtaining primary data such as questionnaire, while qualitative research is a research that may make use of qualitative information through interviews and observations. Given the fact that the purpose of this research is to test the relationship of accounting numbers with the equity valuation, quantitative research is more of the required type for this kind of work. This does not however exclude the use of qualitative research as could be observed in content analysis from statements of various authors. Therefore, a quantitative approach is used here that it will enable the researcher to make use of the numerical and to explore the details of individual perceptions over phenomena. As complement to quantitative research this paper will also use qualitative methods particularly in expounding on the merits of one model over the other for it is in this context that qualitative approach assumes undeniable significance. This paper therefore first uses the quantitative approach by using both the small sample size and large sample size analysis to confirm or the deny the thesis of this dissertation the accounting numbers are good and reliable predictor for stock valuation and to under stand the finer points of the research qualitative research will be used.
Under the large sample size, the researcher used about more than 180 registered companies in UK by extracting relevant accounting numbers such as net income , total assets, etc in relation to total equity valuation of the firms . This paper has chosen multiple regressions to test of degree of relationships for the dependent variable to the independent variables
Under the small sample size approach, the researcher tried to reduce the large sample size from 180 to 50 until it reached 25. The basis for bringing the l80 sample size to 50 is to get only those that have R&D values of £10,000 or more. To get to 25, only those whose balance sheet date was December, 2004 were considered.
The paper will compare the results of analysis between the large and small sample size on whether there is basis to confirm the validity of finding. As a rule if the result of the first is confirmed by the second, then such would be a good sign of the characteristics of the models using accounting numbers.
Before the discussion of the application of the small size sample and large sample size, further discussion of the methodology will also be further discuss to enlighten the reader of this paper.