Analyzing annual reports

Essay on Application: Analyzing Annual Reports. Paper must be at least 750 words. The second company is Johnson & Johnson, which is also in the pharmaceutical industry but adds medical devices and consumer packaged goods. The company was founded in 1886 and has since not retarded in growth. Today, Johnson & Johnson has more than 250 subsidiaries and operate in more than 57 countries, with products sold in more than 175 countries. The employee strength of the company is 128,100 (Hilzenrath, 2000).Comparing and contrasting the two companies in terms of the 4 basic financial statements, which are balance sheet, income statement, statement of retained earnings, and statement of cash flow, there is one thing that is synonymous in both cases. This is, comparatively, each company recorded growth or increases as compared to the previous years. Quantitatively however, the fiscal quantum of growth for Johnson & Johnson was greater than Myler Inc. In such a situation where the sizes of the companies vary, it is important to compare the two using percentages of growth (Sherman & Young, 2001). In this, it is noted that Johnson & Johnson still recorded much growth in almost all three areas. Between the two companies, Johnson & Johnson does not give very clear indication of the role of its auditors by on the part of Myler Inc., auditor opinions were clearly stated in terms of the need for the company to revise its accounting practices and policies. In this, particular mention is made of procedures with respect to revenue recognition. This auditor opinion is rightly in place, given the fact that the kind of accounting practices and policies used by companies go a long way to influence their overall credibility (Merrill, 2007).The footnotes in both reports focused on elaborating on ideas and key words within the main report that were not considered thoroughly explained within the context of the report. What is more, terminologies that did not have regular explanations were explained by the use of such footnotes that

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