Summary Coursework Example | Topics and Well Written Essays - 1750 words

thick - Coursework ExampleAs per the requirements of US GAAP and Securities and Exchange Commission, the income statement of PepsiCo shows the comparative financial performance of the company over last 3 years, i.e. 2009, 2010 and 2012. There is one extra ordinary item is excessively include with the head of bottling equity income. However, this item was of non-recurring nature much(prenominal) that it was present in the income statements of 2009 and 2010 but in 2011, this externalise was non shown by the company. The requirement to show both basic and diluted earnings per sh ar is also provided in the income statement of PepsiCo. There be few optional items also presented by the company in order to provide more meaningful picture of the company especially to its shareholders such as weight average number of ordinary shares outstanding and dividend per share declared by PepsiCo over last three years. Contingencies Contingencies, is a specific type of liability under which ac count head is presented on the face of the equilibrize tack but its amount is not showed. Generally, contingencies include those items the results of which can go either in party favour or against the company such as lawsuits, long-term contractual obligations, commitments etc. However, contingencies are presented only when their several(prenominal) amounts are probable and can be reliably estimated as well. PepsiCo has also provided contingencies on its balance sheet under the name of commitments and contingencies. There are different kinds of contingencies under which PepsiCo is obligated, such as non-cancelable commitments. These non-cancelable commitments include commitments for run leases of building, purchasing agreements with the suppliers of sugar and sweeteners, oranges and its juices and related packaging material. Non-cancelable marketing agreements are also signed by PepsiCo in the main for its sports based marketing. There are some items, which have not been inclu ded under contingencies by PepsiCo such as bottler funding and medical plan related liabilities for retirees. Bottler funding is that agreement which is negotiated by PepsiCo with its suppliers on p.a. basis. Medical plan is not included because expected future cash outflows in this regard are not represented as long-term contractual obligations. Off-balance sheet transactions and items are also not included in the commitment and contingencies because PepsiCo has not made it its practice to include in its financial statements unless they distinguish under the normal course of business of PepsiCo. INTANGIBLES Being a multi-national entity, PepsiCo has acquired different sorts of intangible assets such as signs, computer software, franchises, goodwill etc. The company has developed various criteria in order to value its intangibles, which are discussed below. Brands PepsiCo develops certain brands the cost of which is normally expensed out by the company in the year in which the br and is developed. Certain brands are acquired by PepsiCo such that their goodwill is recognized separately in the balance sheet. With love to the life of brands, there are two types of brands i.e. brands with definite life and brands with indefinite life. PepsiCo has the specific brand evaluation criteria, which it follows in order to assess the life of the brand. Generally, the brands with definite lives are amortized over a period ranging from 5 to 40 years are