General Motors

User Generated

Onfvvy99

Business Finance

Description

Hello,

I need someone write report 2 pages about the General Motors . the report should include your opinion about the case and I have attached example report. Pleases! Write your opinion and what's going on.

When you see the example report, you will see yellow light that's the reporter's opinion. So, you should write your opinion like this.

Good luck

Unformatted Attachment Preview

Anonymous ACCT 542-01 Assignment 2 – Mike Mayo Takes on Citigroup The article “Mike Mayo Takes on Citigroup” was an interesting reading on deferred tax assets (DTAs) and their significance in the corporate banking sector. The article, including the exhibits, did a really good job in explaining what DTAs are and how they related to Citigroup following the housing crises. One criticism of the article I have is that it read more like a timeline of the events surrounding Mike Mayo and his criticism of Citigroup’s treatment of their DTAs instead of providing more critical analysis of the situation. The article was written/revised in the middle of 2012. However, it does not mention any relevant facts after the October 2010 meeting between Citigroup and Mike Mayo. One important fact that one should consider was the actual earnings of Citigroup following the meeting and prior to the article being published. A significant point of contention between Citigroup and Mike Mayo was Citigroup’s future earning potential as estimated in 2009 and 2010. The actual earning quarterly/yearly earning out prior to the writing of the article would have allowed a more critical analysis of the claims put out by both Mike Mayo and Citigroup in 2009 and 2010. With regards to the two opposing views presented in the article, I support Citigroup’s position stronger. Mike Mayo’s statement that having 3 years of cumulative losses should warrant a serious look at writing down the DTA account is valid in normal times but the period between 2008 and 2009 was an extremely unique time in the financial sector. The financial crisis was an extraordinary event which had great consequences for the whole economy and not just Citigroup. By taking the 3 year cumulative losses which occurred due to the financial crisis and trying to extrapolate earning twenty years from than does not sound like a very solid argument for writing down the DTA account. The circumstances surrounding the financial crisis and Citigroup taking the related losses should not repeat themselves in the 20 years following the booking of those Net Operating Losses. In my opinion, the determination to write down Citigroup’s DTA account should have been delayed a few years after the financial crisis when more “normal” years can be analyzed to determine future earning potential. Since it is 2017 now and more “normal” years have passed a better look can be conducted to see whether a DTA write-down is appropriate. I pulled up and reviewed Citigroup’s 10-K for year ending 12/31/2015. The DTA for 2015 is broken down on the following page. Citigroup showed $47.8 billion in net DTAs in 2015 which is an increase from the $44.5 billion shown on the 2008 10-K filing. This shows us that Citigroup was not successfully in generating enough income in the six years following the financial crisis to use up any of the DTA but instead even grew it a little. As the 20 year limit to use up the NOLs created during the financial crisis get closer, Citigroup would find it harder to fully use up those NOLs. As the chart shows, Citigroup has not taken any valuation allowance as of 2015. They wrote in the 2015 10-K the following “While Citi’s net total DTAs decreased year-over-year, the time remaining for utilization has shortened, given the passage of time, particularly with respect to the foreign tax credit (FTC) component of the DTAs. Although realization is not assured, Citi believes that the realization of the recognized net DTAs of $47.8 billion at December 31, 2015 is more-likelythan-not based upon expectations as to future taxable income in the jurisdictions in which the DTAs arise and available tax planning strategies (as defined in ASC 740, Income Taxes) that would be implemented, if necessary, to prevent a carry-forward from expiring.” These reasons are almost the exact same reasons given by Citigroup in 2010 for not taking the DTA write-down. An analysis of Citigroup’s recent net income shows improvement from the years looked at by Mike Mayo in the article, however, if the improvement is large enough remains to be seen. In concluding, I feel that Mike Mayo’s argument was weaker regardless if it turns out that he might have been right. However, I felt Citigroup’s response of freezing Mike Mayo out was just a horrible PR move regardless if I felt they had a stronger argument. They must have known that freezing Mr. Mayo out would make the financial news and the optics of freezing him out made it look like they were not confrontable talking about the issues brought up by Mr. Mayo. Thus it just strengthen the feeling of uncertainty surrounding this whole issue.
Purchase answer to see full attachment
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Explanation & Answer

hello, kindly find the attached completed work. Thank You

Surname1
Student’s name
Professor’s name
Course title
Date
General motors pension plan
The article by Janet Cater was a comprehensive piece about the biggest automaker in the
US. It provides detailed information about the General Motor's company financial position and
more specifically about its pension schemes. Carter provides financial statements to be more
elaborate on the mega automaker's financial position and its effect on the company's pension
plan. It was an educative article, because of the financial statements used in the discussion about
the company's performance. However, the article had some few imperfections. A good example
is, the article provided exhibit...


Anonymous
Great! Studypool always delivers quality work.

Studypool
4.7
Trustpilot
4.5
Sitejabber
4.4

Similar Content

Related Tags