Technological Institute of the Philippines

363 Pascual Casal St, Quiapo, Manila, 1001 Metro

Manila

FINANCIAL STATEMENT
FIN 002A-ACTCY21S2 - Financial Management

Submitted by:
Queenmacy Concepcion S. Alquillera
Adliana Colin A. Amistoso
Pamela Jean M. Bonifacio
ACTCY21S2

Submitted to:
Mr. Heherson M. Martinez, CPA
 Technological Institute of the Philippines
363 Pascual Casal St, Quiapo, Manila, 1001 Metro
Manila

Swift Foods, Inc. was formed on June 6, 1994 to take over the
manufacturing, marketing, and distribution of processed and canned meat products,
poultry products, and commercial feeds that RFM Corporation had been doing.
SFI was organized primarily into two commercial divisions: agribusiness
(poultry and feeds) and meat (meat processing and sales and distribution). The
meat division's manufacturing, marketing, and distribution activities were returned
to RFM in 2002. The poultry business has been the Company's exclusive operation
since 2006. The company operates ten integrated locations around the country that
hatch, raise, dress, and distribute poultry to customers within its geographic area.
SFI's agribusiness sector manufactures and distributes live and
dressed/processed chicken, as well as other poultry products. Broiler growth
operations and dressing/processing operations are the two procedures involved in
the Company's chicken production. Dressed chicken can be purchased whole,
broken up into parts, or customized and processed to meet the needs of the
customer.
The trade license deal between the Company and RFM was finalized in
2012, giving the latter control of the "Swift" brand, which it later sold to a third
party. Swift Foods, Inc. is a company that deals with poultry. It operates in two
segments: Poultry and Leasing. The Salvador Z. Araneta, Francisco D. Gamboa
Sr., Leonardo Eugenio, Maria Victoria Concepcion, Burton Joseph Server Sr., Pete
Grimm, Slbino Z. Sycip, Zoilo Alberto, and Jose S. Concepcion Jr. formed the
corporation in Mandaluyong City, Philippines, in 1964.
Swift Foods Inc is engaged in manufacturing, marketing, and distributing
poultry products and commercial feeds. The company reportable segment includes
Poultry and Leasing Business. The company operates and derives principally all of
its revenue from domestic operations.
 Technological Institute of the Philippines
363 Pascual Casal St, Quiapo, Manila, 1001 Metro
Manila

If we are just to look at the Balance Sheet and Income Statement of

our chosen company’s previous and current year status yes, we can clearly see the
changes but we cannot tell if the company is doing well or is just hanging. There
are ways on how to determine the financial strength. Let’s just look first at the
Annual Financial Report of the Swift’s Inc.
Balance Sheet

Item Current Year Previous Year

Current Assets 21,495,215.00 22,007,650.81

Total Assets 361,794,565.00 283,768,590.81

Current Liabilities 47,247,774.00 52,250,001.85

Total Liabilities 155,496,305.00 136,636,158.38

Retained Earnings/(Deficit) -2,861,707,545.00 -2,920,876,373.91

Stockholders' Equity 206,298,260.00 147,129,432.43

Stockholders' Equity - Parent - -

Book Value Per Share 1 1

 Income Statement

Item Current Year Previous Year

Gross Revenue 45,499,523.00 65,181,000.00

Gross Expense 17,106,843.00 17,178,000.00

Income/(Loss) Before Tax 83,447,243.00 122,916,000.00

Net Income/(Loss) After Tax 59,485,128.00 91,210,000.00

Net Income/(Loss) Attributable to Parent - -

Earnings/(Loss) Per Share (Basic) 0.03 0.05

Earnings/(Loss) Per Share (Diluted) 0.03 0.05

Technological Institute of the Philippines
363 Pascual Casal St, Quiapo, Manila, 1001 Metro
Manila
 Technological Institute of the Philippines
363 Pascual Casal St, Quiapo, Manila, 1001 Metro
Manila

By determining the financial strength of the company, we should

not be contented or make a decision just by looking at the company's asset and
liabilities to know if the company have a bad or good health. In order to make our
conclusion we use some proof to support it by using the Liquidity Ratio and the
Leverage Ratio. In liquidity ratio, it is the technique on how easily a company can
pay its debts so that the company won’t eat by the bank or creditors.
Example of this is the Current Ratio, this ratio shows how the
company can easily change their stuff into cash within the next 12 months to pay
their debts in the 12 months. It says in the current ratio that it is consider as a good
health if the ratio is around 2 to 1 and lower than that the company will find
difficulties in paying debts.
In our chosen industry, we computed the current ratio (current
asset/current liabilities) and it resulted in a low ratio, 0.45 in current year and 0.42
in previous year. Therefore, the industry's financial strength is in bad health.
Another technique we use is the Leverage ratio. In leverage ratio it is the debts that
they use in the company to make their company run and stay alive. Example of this
is the Simple Debt Ratio, this tell us how much percentage of a company's asset are
paid for by debt.
Normally the company considered "safe" when the debt ratio is
low. In our chosen industry we computed the debt ratio ((asset-liabilities)/assets)
and it shows a high ratio which is 43% in current year and 48% in previous year
that show that the ratio is almost a half. Therefore, we conclude that in our chosen
industry, their financial strength is in bad health given by the basis or techniques
we use to support our conclusion.
 Technological Institute of the Philippines
363 Pascual Casal St, Quiapo, Manila, 1001 Metro
Manila

Based on this Financial Statements, what do you think are the decisions that
Finance Manager has made for the corporation?

As discussing this within our group, we all came up with one thing
that we thin the Financial Manager has decided for the corporation and that is to
continue borrowing money and putting up loans just for them to run and continue
the life of their company. As we have said earlier, the only thing that is making the
company run is them borrowing money from other creditors in short, the company
is running through the debt. Normally the company considered "safe" when the
debt ratio is low. In our chosen industry we computed the debt ratio ((asset-
liabilities)/assets) and it shows a high ratio which is 43% in current year and 48%
in previous year that show that the ratio is almost a half. Therefore, we conclude
that in our chosen industry, their financial strength is in bad health given by the
basis or techniques we use to support our conclusion.

“I accept responsibility for my role in ensuring the integrity of the work

submitted by the group in which I participated.”