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Identify two (2) pieces of information not included in the principal financial statements that you think...

Identify two (2) pieces of information not included in the principal financial statements that you think would be important to someone considering whether to invest in your company. Explain your reasons for believing that this information would be important in making an investment decision.

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Expert Solution

Two pieces of information not included in the principal financial statements that you think would be important to someone considering whether to invest in your company is:

(i): Projection premise and strategic planning premise.

(ii): R&D pipeline.

My reasons for believing that this information would be important in making an investment decision is that principal financial statements do not provide cash flow projection premise. Cash flow projections are done on the basis of several assumptions and the future cash flow of a company derives the value of a firm. Projection premise and assumptions are based on strategic planning premise as well for a company as strategic implications have a direct bearing on a company’s future cash flow.

The second factor is R&D pipeline. This pipeline determines the schedule of new products to be introduced to the marketplace by the company and investors like to invest in a company in which R&D pipeline as well as schedule of new products is quite strong. This will ensure earnings visibility for the company in future.

jeff jeffy answered 1 year ago
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