Business Valuation of Polo Ralph Lauren Corporation - Mark Moore ...

Polo Ralph Lauren provides adequate and quality information to its shareholders andthe public. They do this by creating valuable and factual information that is released toeveryone. The explanations were finely broken down to identify the key gains and lossesthat showed the growth of the company.Identification of Potential “Red Flags”Polo Ralph Lauren has a section in there 10k annual reports called “Changes in andDisagreements with Accountants on Accounting and Financial Disclosure”. Theexplanation in this section by the company was “Not applicable”. So therefore therewere no changes. When we looked at the company’s financial statements there were notany unusual large changes in the numbers from the last five years. Considering PoloRalph Lauren is a well established company and they pride their selves with their criticalaccounting principals their have not been any recent changes or cause for concern or RedFlags. Their have been increases in accounts payable, that is due to the payoff of shortand long term debt. The other increases are all minimal increases and follow the growthof the company.Undo Accounting DistortionsAfter reviewing all pertinent financial data of Polo Ralph Lauren, we have concludedthat the financial reports display transparency in the quality of disclosure. The companydoes a very good job the extensive explanation of the increases and decreases that offseteach other. There was no indication of misleading activity within the financial reports.The statement of cash flows was concurrent with the disclosures in the footnotes. TheCritical accounting policies were apparent in the financial statements of Polo RalphLauren, and there was no distortion to enhance the true performance of the company. Allmethods of accounting were clearly explained in the footnotes to the financial statements.Considering no accounting distortions were revealed, there is no need for anyadjustments or corrections to the financial statements.19