The spreadsheet entitled “Procter&Gamble_financial_data_template.xlsx” to be used for this exercise is on the course website. You can also find the latest Form 10-K here: http://www.pginvestor.com/phoenix.zhtml?c=104574&p=irol-sec. This is an individual assignment to be submitted in hard copy.
Review Chapter 8/10/12/13 of the course text and the slides on “Reformulating Financial Statements”. Go down the line items on Procter's balance sheet and income statement for 2012 and identify which items should be designated operating and which items should be designated financing. Place an “F” or an “O” next to the item, depending on your assessment. If the designation is not immediately obvious to you, try to find information in the footnotes or management discussion and analysis (MD&A) that helps you discriminate.
Based on the designations above, reformulate the 2012 balance sheet of Procter & Gamble. Remember that because Assets-Liabilities=Shareholders Equity, it must be the case for the reformulated balance sheet that:
Net Operating Assets minus Net Nonoperating Obligations = Common Stockholders equity,
i.e., NOA-NNO = CSE
Note that NOA + NNO (net financial assets) = CSE, if Financial assets (FA) exceed financial obligations (FO).
Based on the designations above, reformulate the 2012 income statement of Procter & Gamble. Remember that the allocation of tax to operating