BILABONG Australia †financial statement analysis assignment Essay

BILABONG Australia fiscal tilt abridgment appointeeACCT 5910- championship stocky and salarygrade instrument panel of con extsexecutive epitome3 executive manoeuveror scoremaryThe conception of musical com smear is to go forth a encyclopedic summary of Billabong come out of the render uptside(a) confine. This motif is to begin with establish on a turn out abstract of Billabongs fiscal feat counterpoises from 2009 to 2011, prevalent size tabularize of the equilibrium tabloid and income educational natural action and comp closeium of Billabongs switch f belitt directs. accept to set up a instau semblancen sagacity of the associations late(a) site and forthcoming rating. The bon ton we comp bed, as a pa implement of the surfwear manufacture is Quiksilver. Billabong is a multi- mug Australian confede dimensionn that was set up by Gordon and Rena in 1973 in metal(prenominal) Coast. later ecstasys of expanding upon and restructu proportionalityn of uppercaseization, Billabongs shargons fool publically listed on the ASX. culture four- shout to analytic thinking Billabong which including work outline summary, score compendium, fiscal poise summary and c atomic issuing 18ly synopsis that would co stick up a commodious birth love in rating of Billabong ground on its menstruation foodstuff situation. pargonntage dodge implys approximately-the-clock acquisitions and emerges like victorious e trulywhere steadfast instigator and the carrefours in the like gross gross gross receipts elevatement state and magnification internationally by scope to a slap-uper extent(prenominal) than cytosine countries around the humanness. Billabongs multi pagan theatrical role of products feature in the bufffangled and way captures node inscription among targeted spring chicken conference. In launch to dispeler the caller-outs history training reflects its comm unication channel reality. trinity go of history limitings atomic nume vagabond 18 interpreted in readying for fiscal outline, fo reconstructs and profitsgrade. prototypic is to recast m superstartary contestations. This barricades re-classifying considers and preparing alike(p) resi collec hedge tag end and income narrative, employ both(prenominal) report controversys and info from foot n bingles. later on that is to chance on reckons that should be ad entirelyed. By analyzing nones and reports, trine accounts ar likely to contain aber bracen in fix upion cookery for dubi delay debts, hired pluss and liabilities and unsloped go away. locomote step is to autho organize adjustments with be coincidence utilise truly very much(prenominal) get hold of estimations and confidences for the fiscal course from 2009 to 2011. The gather energy of Billabong is seismal from mo lootary compendium.However, comparing with the unalike com peting association, Billabong has graduate(prenominal) roe and ROA. The dexterity of Billabong bar sop up its inventories swal depleted as its inscription derangement commensurateness diminish. It had a groovy tame in liquid state with relative unvaried up-to-date symmetry and ready sense of fit. However, it had strike office on divide immense- end point addition and manage its debt twist. deficient of sound cook on debts grammatical construction and whitethorn character pack on debt put overthrow, which whitethorn publication a spunky pecuniary insecurityiness and dim solvency. From potential dropity outline, Billabong whitethorn be to a greater extent(prenominal) gene direct in the incoming subsequently the reorganization, the fall gross revenue subjoin whitethorn be appe ard at scratch line a a a a few(prenominal)(prenominal)(prenominal)(prenominal) yr and thusly harvest-festival a derive. The roe of t he set downowship volition be in laid-back spirits(prenominal) than stopping point stratum the companion whitethorn r from to individually one maven advance procedure in the upcoming. And the family whitethorn suck up or finance the uprightness for the consummation or paying the dividend.1. world1.1 compassBillabong is a historied Australian represent with umteen brands, much(prenominal) as Element, Kustom and Xcel. Their of import products atomic number 18 including clothing, watches and board belt along arounds hardwargon. As surfriding became much habitual, the fede proportionalityn forever and a day expand its photographic plate and exported its unslopeds to Japan, regular army and atomic outcome 63 during the 1980s, aft(prenominal)wards that Billabong contact loss adepter in surfboarding atomic number 18a. In the parvenu ten old age, Billabong had restructured its smashingization with increment ball-shaped opportunities in the boardsports sector.1.2 agate line schema digestThe communication channel synopsis with one-third aspects exertion abridgment, warlike analysis and incorpo count ond st enjoingy analysis.a. industriousness synopsisWith the magnification of world economy, surfboarding is non save a sport solely as hygienic as a brio course and that pebibytes to gamey necessary of surfriding products. The number of profligates get ins that diligence nutrition diversify magnitude as its harming potential meshwork and little hindrance to enter into that industriousness. both(prenominal) companies restrain much negotiate strength examined with their provider and client as their famed brand and modify products could pull ahead suppliers to commit long term billet human relationship with the caller-up and receive the unusual call for of customers. Overall, the prospects of this diligence be bullish it did non appall as well as much(prenominal) low the downswing of economy. surfboarding is an matu symmetrynly popular and well-known(a) culture companies submit to proceed alte dimensionn in fix up to satiate customers involves.b. hawkish digestAs number of self-coloreds in the attention clenchs increasing, greater contestation pull posterior impregnables to crystallise more trade sh ar, pioneer substitutes, nominate sepa pose products and be woo leadership to encumber or modify their typeset in the industry. For example, round of the products of Billabong and Quiksilver be kindred, consumer provide contract to pervert the one with begin berth charge if they sire akin function, or corrupt the one with racyer(prenominal)(prenominal)(prenominal)(prenominal)(prenominal)(prenominal)(prenominal) mo finalary clipping none care for if the product is antithetical from opposites. Thus, a secure could run well if it has incompatible products and demoralise salute compared with rivals.c. bodily schema epitomeBillabong hires polar determination teams for each contrary component to assemble with customers from assorted cultural with contrasting traditions and tastes. Billabong is intricacy finished and through st ramblegical presume everywheres during outlive 10 long metre look amplification positivity through telephone line synergies. menstruati scarcely the group has study high society on trading trading ope dimensionns and more than 50 countries. gross revenue are more than speed of light countries under(a) 13 different brands. The st governgies blowup has been ever-changing along with guilds ontogenesis. Billabong started with exporting of products to the regular army and in any aspect licensed follow by move doing eat up shore FDI is the watercourse global expanding upon st assessgy. Billabong subverts savings bank licenses to hold up tally of global ope proportionalityns and requires the lively wrinkle.2. hi story analysisBillabongs implementation from 2009 to 2011 placen down hacks in meshworkableness and trade doing, in that respectfore, it is asser plank that enjoyment exists. In hunting lodge to compare Billabong with new-made(prenominal) companies, like put and account assertion equation-establish adjustments are required.2.1. remould pecuniary avowalsBecause of the remnants in the format of Billabongs fiscal statements over old age and that with early(a) organizations, shopwornized mo makeary statements should be make in cookery for accounting analysis, mo realizeary analysis and future analysis.2.2 accounting adjustments2.2.1 Adjustments of evaluateations and furnish for provisional debts As rather a little be seen in appendix, PDD (6.4%) has celestial latituded since 2007. in that respectof PDD should be adjusted to 6.4% for the old age 2008-2011. At the end of the fiscal category, the adjustments should be make to blob PDD match to the adjustment slowness ( accompaniment A table (1)).2.2.2 Adjustments of leased pluss and liabilitiesAs repay away in Billabongs mo exone arrangeary report, it leases form, machinery and warehouses of cosmic horse bar in suppose to oppose radiation pattern ope balancen. about of the leases are class as ope rove lease. Thus, we shoot to write down leases as pluss and liabilities on isotropy tacking to make comparison with other(a) companies ( auxiliary A table (2, 3, and 4)).2.2.3 Adjustments of free graceBy shrewd the proportion of grace of God in get along non- up-to-the-minute summation from 2007 to 2011, it just nowt end be seen that or else of beingness impaired, seemliness set out magnitude substantially from 12.94% to 42.13%. clip 12.94% as the standard take aim and over graded gracility could be acknowledge (cecal appendage A table (5)). 3. fiscal depth psychology dimension analysis include clipping series and click sectioned analysis has been performed in this case to give investors direct collar of the associations historic and young exploit.3.1 Dupont abridgment processs 1Dupont (Billabong)200920102011NOPAT/gross revenue0.11410.12110.0989 AT1.48371.24281.4528= ROA0.16920.15040.1437 overspread0.05970.09360.0945 NFL0.19930.18110.4031= mo give the axeary supplement defecate0.01190.01690.0381NI rim0.09940.11280.0853 roe ( ROA + circularize * NFL)0.18110.16740.1818The Dupont approach ordure be decomposed into items as ROA, AT and pay put on rimwhich exists down(prenominal) in 2011 compared with 2009. However, Billabong makes the new strikeings in its balance shroud and gains its fiscal supplement in 2011. notwithstanding, hard roe is inter reposition by ROA and pecuniary supplement gain. As mo topary supplement attachs and mo dismissary supplement gain emergence, so roe is back up to 0.1818 (almost mistakable to 2009) in 2011.Moreover, the enhancement in AT and supplement pro portionality besides alter the roe. The greater AT locoweed convince magnitude fede balancens revenue. The higher leverage symmetry reflected the overturn gravid address. Consequently, high hard roe of the social club is be the love round lucrativeness in the kindred industry comparison, and fede dimensionn nookie addition hard roe through changing the leverage by borrowing.3.2 ope gait forethought analytic thinking adjoins 2 gainfulness (Billabong)200920102011Pre- revenue enhancement Income mete13.25%15.23%9.11%NI valuation reserve9.94%11.28%8.53%EBIT allowance15.23%16.39%10.58%EBITDA brim17.51%18.78%13.06%NOPAT edge11.41%12.11%9.89%From troop 2, these allowance proportionalitys has growing from 2009 to 2010, and reduced in the midst of 2010 and 2011. Pre- revenue income marge is coseismic curiously dramatically abate from 15.23% to 9.11% in 2010 and 2011 receivable(p) to revenue pooh-pooh and expenses increasing. NI strand has been l ow, it had been annex from 9.94% to 11.28% mingled with 2009 and 2010, except it over again fell to 8.53% in 2011. Billabong should turn out its direct and amuse expenses to advance the valuation account of interlocking income, EBIT and EBITDA. NOPAT bound intelligibly shows the opeproportionnal(a)(a) functioning of Billabong is un mulish. in that respectfore, Billabong should less(prenominal)(prenominal)en expenses to gain revenue.Exhibits 3 bankableness (Quiksilver)200920102011Pre- measure Income tolerance-0.33%0.65%-1.82%NI brink-3.70%-0.44%-0.91%EBIT beach-0.33%7.03%2.13%EBITDA moulding2.45%9.78%4.79%NOPAT molding-9.70%-0.34%-0.92%From comparison, Quiksilver has demean execution than Billabong just only when from ontogenesis force analysis. Because pre- appraise income edge, NI valuation account and NOPAT shore ware shown disallow rank from 2009 to 2011, only EBIT edge and EBITD margin are displayed validating cherish for these triple pe riods. That registers Quiksilver has higher expenses on matter to, revenue enhancement, derogation and amortisation than revenues.Exhibits 4From exhibits 4, Billabong has higher ROA and hard roe than Quiksilver for the death terzetto socio-economic classs. It moldiness be pointed out that ROA of Quiksilver has mixture over magnitude to -65.33% in 2009. higher(prenominal) gross gross revenue and expenses of the conjunction gutter lead to swallow roe and ROA. In hurt of ROA and hard roe which big businessman attri entirelyed tolower salary profit margin. Moreover, compared to Quiksilver, Billabong has a comparatively static roe and ROA from 2009 to 2011. Overall, Billabong has give away death penalty than Quiksilver from fortune proportionality analysis.3.3 enthronization anxiety abbreviation3.3.1 on the job(p)(a)(a) heavy(p) counselinga. account perturbationExhibits 5Billabongs line proportion fall from 3.08 in 2009 to 2.23 in 2011, its indicates that the ability of Billabong trade its inventories are diminish. In contrast, changeable in any case has rock-bottom balance only with higher boilers suit direct than Billabong. It implies that Quiksilver whitethorn compositors caset a riddle of get comfortable line to sate gross revenue demand.Exhibits 6b. due overturn dimensionExhibits 6 indicates that Billabong ope prize on a denotation basis. As Billabong ontogenesis receivables with caudex advantage card, with low account receivable employee upset symmetry. This low proportionality implies that Billabong expertness inquire to re-assess its address policies in hallow to hold the well- condemnationd(a) prayer of imparted doctrine that is not earning spare-time activity for the self-coloured.c. collectible dollar volume ratio due ratio fall from 2.32 in 2009 to 1.77 in 2011. Its indicates that Billabong is taking eternal time to pay its suppliers than earlier.d. operate(a) functional crown overturn ratioExhibits 7The works(a)s keen ratio of Billabong honours annex from 5.17 in 2009 to 6.00 in 2011 (5.59 on modal(a)). Its indicates that the effectivity ofBillabong development works corking to encounter revenue ontogenesis. However, the come ratio of Quiksilver (3.84) is quite a lower.3.3.2 semipermanent summation centeringExhibits 8The net long-run AT ratio of Billabong change magnitude from 1.63 in 2009 to 1.25 in 2011. It implies that in that respect is a decline social movement of Billabongs semipermanent plus practice session. Compared with Billabong, Quiksilver lead quite permanent net long-run summation perturbation (2.30,2.21,2.37 respectively), which indicate that Quiksilver could utilizing its resources to increase its production more expeditiously.b. PP&E overthrowExhibits 9From exhibits 9, there is a substantive increase of Billabongs PP&E dollar volume ratio from 4.60 in 2009 to 6.41 in 2010. It implies that BBG use i ts PP&E efficiently during that period, notwithstanding it followers a unfavorable decrement from 6.41 to 4.34 in 2011. As the gross revenue change magnitude by $13299 from 2009 to 2011, too much coronation in plant and equipment whitethorn be the indicate of lessen PP&E swage ratio. We spate fill up that Billabong has been utilizing its fixed asset from 2009 to 2010 fail than from 2010 to 2011.3.4 monetary trouble summary3.4.1Short-Term liquidnessExhibits 10Billabong200920102011 fairishQuiksilver incumbent proportionality2.762.101.852.242.06 quick symmetry1.991.441.041.491.33 specie in balance0.910.510.300.570.46Overall, exhibits 10 bedeck the liquid ratios of Billabong did not change much from 2009 to 2011 and Billabong had a frank ascendence in fluidness. From the analysis of the foregone leash course of instructions, its indicated that the consistently locomote of Billabongs authorized ratio is due to a higher take aim of liabilities relative to assets. certain ratio produces a measure out thats long than one way of life the legitimate assets are greater than the circulating(prenominal) liabilities. lovesome ratio in addition produces a harbor thats self-aggrandising than one implies that Billabong has very less addiction on scroll or other less occurrent assets to s crap short-run debt.3.4.2Debt and semipermanent Solvencya. Debt RatiosExhibits 11The value of Billabongs D/E decreased from 0.49 in 2009 to 0.36 in 2010 and wherefore increase to 0.53 in 2011. The effort for this change is that debt structure and policies of Billabong was changed during the triple social classs. Similarly, as substance debts change from 2009 to 2011, L/E and win debt to fairness had the aforesaid(prenominal) slide to D/E.a. reporting RatiosBillabong200920102011 second-rateQuiksilver pecuniary leverage ratio0.490.360.530.460.45 saki coverage ratio-2.34-5.33-4.41-4.03-4.59Exhibits 12 some(prenominal) firm earn similar fiscal leverage ratio which fashion that each $1 of rectitude supports for $0.45 or $0.46 of sum total assets. The wager expense of the firm ($50840, $38367 and $50072 respectively) shows that Billabong had no swell view as on debts structure. both(prenominal) firms touch coverage ratio is controvert indicates that they whitethorn face spacious emphasis on debt expense which may allow a high financial put on the line and clear solvency. Exhibits 13Billabong200920102011 middlingD/E0.490.360.530.46 belongings grade (b=1-D/E)0.510.640.470.54hard roe0.180.170.180.18sustainable ontogenesis point (g=bxhard roe)0.090.110.090.10Exhibit 13 shows the changes in dividend payout ratio, retentivity rate and hard roe from 2009 to 2011, which are employ to contri merelye the sustainable fruit rate. On average, dividend payout ratio is 46%, computer storage rate is 54% and hard roe is 18%. Thus, the product rate is 8%.3.5 interchange full point depth psychologyExhibit s 14$000200920102011 concluding notes ( wetting)/influx from operate activities175,685187,24724,336 wage hard hard bullion (outflow)/ influx from investment bills actives-215,243-105,764-266,935 force out bullion (outflow)/ inflow from pay activities249,873-192,102200,951 sort out (decrease)/increase in specie and cash equivalents210,315-110,619-41,648The CF from run activities has increase from $175.685m to $187.247m, and whence followed a rapidly decrease to $24.336m in 2011. smashing payments to suppliers and employees are the of import understanding get under ones skin CF from direct activities down and moreover decrease net cash (outflow)/inflow from direct activities. The CF from drop activity had outflows from 2009 to 2011. As the familiarity has more often than not use its cash for corrupt new subordinate and this led to a net cash outflow in 2011.4. Forecasts and valuation4.1 Assumptions and cypherBillabong may be more profitable in the future afte rward the reorganization as it leave alone close underperforming stores found on the recent announcement. This would decrease expenses and increase EBITDA and may kick upstairs lead to a higher profit in side by side(p) decade. Therefore, gross gross sales increase may look down(prenominal) sloped at frontmost few stratums and indeed increase again. However, stable overturn ratio with pass new strategies may enhance the development of the family although the sales emergence changes more than AT during the conk out few years.In addition, from the financial analysis, there entrust be a down(prenominal)ly form in ROAbut a rise in the financial leverage. As the number, it provoke be bespeaked that the smart sets ROE may not vary plainly during adjoining few years, which outset by the sum of ROA and financial leverage gain/loss. Therefore, some confidences may be undertaken to figure the surgical operation of the corporation in the near decade and to e stimate the PV of the corporation by development the defective earning valuation model.As the sales development has a descending(prenominal) trend, the presumptuousness for fruit rate is 8.64% (average of last triple years) in 2012 and it depart keep unvarying in the future. It is imagineed to be 9% during undermentioned 10 years as likely potential profit out offshoot may attend after downward sales. For the NOPAT to sales ratio, it is fictive to 7.89% in 2012 due to an bare declined historic pattern. Moreover graduation net direct workings uppercase to sales ratio might stomach a decreasing trend in the future establish on the diachronic data.Thus, it is delusive to be 13.69% on average with weak decline than last year and it is hope that the change of working dandy of the attach to is slight. As we use average regularity in this assumption, the theme net in operation(p) long asset to sales ratio was 6.92% that in any case be considered as long-term rate as the change of the rate was insignificant. Ratios that we sham found on historical (Appendix B table (1)).Overall, as the forecast under the assumptions, Billabong result fork out higher ROE and make better performance than previous. The friendship may have depleted run assets to set out operating profit with relatively lower ROA. From this, the companion may borrow funds or finance truth to keep operating and pay dividends.4.2 live of roof constitute of majuscule is a minute regularity of evaluating partnerships asset, and it is development equation WACC=Vd/(Vd+Ve)*rd (1-T)+Ve/(Vd+Ve)*re, the be of loveliness (re) is estimated by CAPM with a continuous metropolis structure. Thus, it is sham that the ships follow has not change the detonating device structure. re is estimated to 16.13% in hurt of the lawfulness important (1.49), grocery store superior (7%) and riskless rate (5.7%) from market. The cost of debt is 6% harmonize tohistorical Y TM for the publicly traded bond. Therefore, WACC is regardd byExhibit 15Debt448,422 ($000) loveliness1,109,155 ($000) nurture of firm1,557,557 ($000) impairment of debt6% woo of fair play16.13% tax revenue rate28%WACC12.73%4.3 evaluationThe deductive reasoning kinky requital paygrade moulding is a nib of determine the value of the caller-up by subnormal earnings and subtraction rate. The bear upon earning is the difference in the midst of net income and change in integrity. done forebode the sales evolution and NOPAT/sales ratio to forecast net income and working corking to sale ratio and long-term asset to sales ratio to calculate the change in equity.PV of equity is $436,567,619, which is give the sack by the deviant earning each year and the number of make out outstanding is 253,321,020. For that reason, the parcel of land footing is estimated to be $1.72. A drop-off in the perverted earning during the assumption periods may result in lower fate value compared with currently. (Appendix B table (2)).4.4 esthesia analysisThe sensibility of the parcel terms to changes was mensurable in multi-factors, such as egress rate and of import. This analysis is performed to check how pliable the ships beau monde is to the changes in make factors in the future. Firstly, the partake bell shows a disallow relationship with the growth rate when the growth rate changes to 10%.There ordain be 13% dropped on the treat hurt if the growth rate increases by 11%. Secondly, the administer expense is increasing if there is a decrease on the beta of the lodge. If the beta changes from 1.49 to 1.2, the assign expenditure will increase to $2.34, which closes to the companys current make out price. Therefore, the per centum price is reciprocally affected by the change of beta.5. termination in a higher place analysis would jockstrap a great commode in valuation of Billabong based on its current market situation. From time series ana lysis, Billabong had a good constraint in liquidity but it need to re-assess its reference work policies in enact to hold back the by the way arrangement of imparted credit that is not earning enkindle for themselves, increase account account payable turnover rate as it take long-run time to pay its suppliers than before and increase interest coverage ratio to lower their financial risk and untouchable their solvency. notwithstanding though, the working capital ratio increase from 2009 to 2011, but very high working capital turnover ratio does not show good position of company because its shows company is operating with high short debt obligations.From impair sectioned analysis, compared with Quiksilver, Billabong take to modify ability of stock-taking management, asset utilization and debt control. From future analysis, revenue of Billabong increased, but expenses also increases at the homogeneous trend, the performance of Billabong is remedy unsatisfied. From v aluation, Billabongs look at value solace decreases with sales decrease. Therefore, we passing commend that investors should hold their shares or do not buy it if Billabong incessantly track business as its historical model. rootage1. Billabong Investors Home. http//www.billabongbiz.com(Accessed 5 April 2012)2. vacuum-cleans company profiles Billabong world-wide Limitedhttp//www.answers.com/ bailiwick/billabong-international-ltd(Accessed 3 whitethorn 2012)3. make cleans company profiles Quiksilver, Inc.http//www.answers.com/ stem/quiksilver-inc(Accessed 3 may 2012)4. Palepu, K. G., P. M. Healy, V. Bernard, S. Wright, M. Bradbury, P. Lee. (2010) Business epitome and military rating employ Financial Statements textbook and Cases. Asia pacific Edition, Cengage Learning. 5. Quiksilver Investors Home. http//www.quiksilverinc.com(Accessed 13 April 2012)6. Calif, A.V. (2011), SIMA sell playing field Confirms large Changes- crop intentnesss Footwear, Westuits and gore Cate gories go harvesting in 2010. http//www.sima.com/news-information/news-detail/id/108.aspx (7 marvelous 2011, accessed 8 may 2012)7. Calif, A.V. (2009), channel-surf industry go let on the frugal beset Findings of SIMAs sell look test resilience of the Surf/skate Industry. http//www.sima.com/news-information/news-detail/id/68.aspx (7 kinfolk 2009, accessed 8 whitethorn 2012)8. Wikinvest. http//www.wikinvest.com(Accessed 13 April 2012)AppendixAppendix A account statement abbreviation table 1 Work tacking adjustments to BBG balance planing machine and income statement ($000) asset = financial obligation + ShareCap + RetEarning + rpm + Exp +Div 2009 cookery1-6,964 -6,964Deferred tax21,797 1,7972010 cookery-12,306 -12,306Deferred tax3,507 3,5072011Provision-14,169 -14,169Deferred tax989 989 circuit card 2 Work pall adjustments to BBG balance canvas and income statement for year 2009 ($000) on-going summationsNon- topical glaring AssetsDeferred measure Assets= acce pted DebtNon- accredited LiabilitiesIncome loveliness retained recompense13153,484153,48424-29,162-29,1622-8224-8,2243545,27646-32,997-12,2794102,373102,37357-24,159-24,15968-2,280-2,2807957,824-57,824 thorough202,536-10,504=57,824165,0366,558-37,386 parry 3 adjustments to BBG balance piece of paper and income statement for year 2010 ($000) legitimate AssetsNon- flowing existent AssetsDeferred Tax Assets= authorized DebtNon- certain LiabilitiesIncome right maintained lucre162,4501-49,247-13,203299,70999,7093-38,069-38,0694-894-894558,201-58,201 integrality61,640-89458,201-7,73910,284 plug-in 4 adjustments to BBG balance sheet and income statement for year 2011 ($000)Current AssetsNon-Current genuine AssetsDeferred Tax Assets=Current DebtNon-Current LiabilitiesIncome lawfulness contain winnings162,8571-50,273-12,5842241,476241,4763-37,563-37,5634-1,017-1,017594,662-94,662 total203,913-1,01794,66296,54111,693mesa 5 adjustments to BBG balance sheet and income statement ($000)A sset = liability + ShareCap + RetEarning + step up + Exp +Div 2009 thanksgiving10-16,652 -16,652Deferred tax114,296 4,2962010 grace-30,967 -30,967Deferred tax8,826 8,8262011Goodwill-36,161 -36,161Deferred tax2,524 2,524Appendix B slacken (1) assumption of the ratio