Proterra was founded by Dale Hill in 2004 with a vision to design and manufacture world-leading, advanced technology heavy-duty vehicles powered solely by clean domestic fuels. After launching a first successful fleet of alternative fuel buses in the 1990s, Proterra focused on developing the 'bus of tomorrow.' Proterra Inc. also designs and manufactures heavy-duty vehicles including EcoRide, a battery electric and zero-emissions bus, and Proterra Catalyst, an electric transit vehicle. The company manufactures a TerraFlex Energy System that enables customers to select amount and type of energy storage to meet specific route requirements, plus TerraVolt fast-charge batteries, TerraVolt extended range batteries, an on-route charge station and in-depot charging services. It offers financing solutions, route simulation analysis, battery lifecycle management, and standard warranty services (Proterra, 2015). It serves customers throughout the United States. The company is privately owned, but is in the process of becoming a public corporation. With this expectation, the firm's chief executive officer (CEO) has asked for determination of which of two companies appears to be a better peer to compare itself against, New Flyer Industries, Inc. (a Toronto-based firm), or Tesla. Tesla Motor Vehicles designs, develops, manufactures, and sells high-performance fully electric vehicles and stationary energy storage units similar to certain Proterra products. Tesla Motors has subsidiaries in North America, Europe and Asia, with the primary purpose of these subsidiaries being to market, manufacture, sell and/or service their vehicles (Tesla Motors, 2016). New Flyer was founded in 1930, and is now the largest transit bus and motorcoach manufacturer and parts distributor in North America with fabrication, manufacturing, distribution and service centers in Canada and the United States. It is North America's heavy-duty transit bus leader and offers clean diesel, natural gas, diesel-electric hybrid, electric-trolley and battery-electric. Information regarding Tesla and New Flyer is given here, for your use in comparing these firms.

Tesla Versus New Flyer

Significance

Measure

TSLA

NFI

Total Market Value of all outstanding shares.

Market capitalization

33.63B

1.831B

Number of outstanding shares currently held by all shareholders.

Outstanding shares of stock

147.28M

59.742M

A Beta coefficient indicates the systemic risk that an asset has relative to an average asset. A risk-free asset has a Beta of zero.

Beta

1.28

0.16

The return the firm must earn on its existing assets to maintain the value of its stock, and the required return on any investments by the firm that have essentially the same risks as existing operations.

WACC

9.03%

8.34

PE ratio divided by expected future earnings growth (after multiplying the growth rate by 100).

PEG Ratio

18.47

0.5

A measure of profit per dollar of assets.

ROA

-7.04%

6.26%

A measure of how the stockholders fared during the year.

ROE

-113.20%

13.21%

A measure of how much investors are willing to pay per dollar of current earnings. Higher PEs are often taken to mean the firm has significant prospects for future growth.

P/E Ratio

-29.17

25.3

Ratio of Net income to sales.

Profit Margin

-23.91%

-3.83%

References

Bloomberg. United States rates and bonds.

Federal Reserve. (2016). Federal Reserve economic data.

Korosec, K. (2015). This startup is gearing up to be the Tesla of electric buses. Fortune Magazine.

Proterra. (2015). About Proterra.

Securities and Exchange Commission. (n.d.) SEC.gov home.

Tesla Motors. (2016). Tesla Motors, Inc. 2016 annual report.

Yahoo. (n.d.) Yahoo finance.

Assume that you are the finance manager for Proterra and you have been asked to provide an analysis of the following issues, as the firm develops benchmarks for its cost of capital (WACC) estimates. The firm's CEO has instructed you to use the pure play approach to estimate its WACC cost of capital, and has chosen Tesla Motors (ticker symbol TSLA) and New Flyer (ticker symbol NYI.TO) as possible representative peers (Korosec, 2015). You will deliver your analysis in the form of a memo, or formal communication addressed to the firm's CEO. In this discussion, you are to present this memo in which you:

QUESTION:

Using the information provided here and speaking of Finance Director of Proterra, brief the firm's CEO, analyzing: Analyze the relative applicability or inapplicability of utilizing these firms as peers to evaluate Proterra's likely cost of capital, given what you know about Proterra, Tesla and New Flyer, and the lessons of Capital Market History.

An article in the U.S. News & Works Report (September 28, 1981) states that approximately 21.3 million workers, more than a fifth of the workforce in the United States, have unorthodox working hours. More than 9.3 million work on a flexible schedule (the worker plans his own schedule) or on a weekly "compressed" schedule. A company planning to install flexible hours estimated that an average of 7 hours a day per assembly worker was needed to operate efficiently. Each of the company's 80 assemblers was asked to submit a tentative flexible schedule. If the average number of hours per day for Monday was 6.7 hours, and the standard deviation 2.7 hours. Using a 95% confidence interval, do the data provide evidence that the average number of hours worked every Monday, for all fitters in the company, will be less than 7 hours?

Por medio de una prueba de hipótesis, contestar usando un nivel de significancia del 5%

An article in the July 5, 2015 Denver Post reported on the bankruptcy filing of Molycorp, a Greenwood Village-based mining company. Molycorp specialized in the production of rare earths like lanthanum and cerium. The Denver Post article states “In 2009, China, which produced 97% of the world’s rare earths, imposed export restrictions.” As you might expect, China’s action caused a spike in the world price of rare earths. Recently, China lifted its export restrictions in response to a World Trade Organization ruling. Use the supply and demand model to analyze how the end of China’s export restrictions affected the market for rare earths in the United States. You should evaluate the effects on the overall economy and on groups within the economy who are made better or worse off. Specifically, how did China’s recent action affect Molycorp? Your answer must include both a graph and a written explanation.

1. Describe the different components founder under the Performance Tab?

2. Give several examples of using Baseline data?

3. Describe the different sources of data used by Performance Monitor.

4. What type of alert in Performance Monitor can write an event to specific log?

5. What is the default tunnel types for VPN server?

Assuming you have been working with one of the Big4 as auditor for more than 7 years, Mr. Alex Chan is your close friend and he is the son of Mr. Derek Chan, the founder of Apple Ltd., a listed company with very successful track record. Derek and Alex are the chairman and vice chairman of the company respectively. As you are familiar with Alex and his family, you learn that most of the senior management are from the same family of the founder, the financial controller, is in charge of finance department with the assistance of his sister Miss Candy Lee, who was decided to immigrate to England next month. Mr. Alex Chan would like to invite you to replace her as an assistant financial controller helping his brother-in-law, Mr. Peter Lee. Will you accept the offer and justify your answer? (Hint: Identify FOUR features of a family controlled company which affect your decision)

Assume that 28 years ago, the average tuition for one year in the MBA program at a university was $3.4 thousand and now it is $36.8 thousand for one year. What is the compound annual growth rate in tuition over this period? Round to the nearest 0.01% (e.g., if your answer is 6.832%, record it as 6.83)

Discuss the various Schedule A Itemized Deductions, the Standard Deductions for each Filing Status, the Additional Standard Deduction, and those taxpayers eligible for the Qualified Business Income Deduction.

For Tax Years 2019 and 2020, taxpayers can claim medical and dental expenses that exceed 7.5% of AGI when they itemize on a Schedule A.

The citation for the new tax law is the Further Consolidated Appropriations Act, 2020 (Public Law 116-94), which states:

SEC. 103. REDUCTION IN MEDICAL EXPENSE DEDUCTION FLOOR.

(a) IN GENERAL.—Section 213(f) is amended to read as follows:
‘‘(f) TEMPORARY SPECIAL RULE.—In the case of taxable years beginning before January 1, 2021, subsection (a) shall be applied with respect to a taxpayer by substituting ‘7.5 percent’ for ‘10 percent’.’’...
(c) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years ending after December 31, 2018.

The Bill of Rights contains the first 10 amendments to the U.S. Constitution, which can be seen below:

Bill of Rights

The first ten amendments to the U.S. Constitution make up what is known as the Bill of Rights. These amendments form part of the essence of what makes United States citizenship the privilege that it is. Many people are familiar with freedom of speech, freedom of religion, and freedom of the press, but these important Constitutional amendments offer more than those rights. You can review the first 10 amendments and the rights they guarantee below.

Amendment 1 Annotations

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

Amendment 2 Annotations

A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.

Amendment 3 Annotations

No Soldier shall, in time of peace be quartered in any house, without the consent of the Owner, nor in time of war, but in a manner to be prescribed by law.

Amendment 4 Annotations

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Amendment 5 Annotations

No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

Amendment 6 Annotations

In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor, and to have the Assistance of Counsel for his defence.

Amendment 7 Annotations

In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.

Amendment 8 Annotations

Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.

Amendment 9 Annotations

The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.

Amendment 10 Annotations

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

Review the 10 amendments. Which ones are relevant to businesses?

Manhattan is a thriving technology company that has had success producing smartphone games with in-app purchases. Manhattan has recently acquired two other companies to expand its game offerings and increase its workforce. The Founder and CEO started the company a few years ago and is an app developer himself. He does not have any training or experience in accounting or finance but has decided it is important to surround himself with the best people possible. He has hired several accountants with professional designations to help with the financial reporting.

The company’s accounting relies heavily on estimates because most of the company’s assets relate to work in progress as new games are always being developed. Once a game has been released it can generate significant revenue, but consumers tend to tire of games quickly and the long-term value of the product is never certain. As a result, assets are hard to value and complex accounting methods must be used.

The CFO is a designated accountant and a former partner at an audit firm. She has used the company’s technology skills to ensure that the IT controls around accounting information are strong. She has placed a real emphasis on segregation of duties and accounting staff take turns checking each other’s work as a means of detecting mistakes and learning from each other.

Required:

As an auditor how would you assess the control risk, high or low? Provide two reasons to support your assessment.