Use the Healthways financial statements= Attachment
1) Using formulas, conduct a horizontal analysis by calculating changes over the periods of time for which you have statements. Conduct your analysis for the following over the 2–3 years for which you have statements:
· Changes in Revenue
· Changes in Expenses
· Changes in Net Earnings
2) Calculate the organization’s Return on Assets (ROA)
3) Save and submit your assessment.
Create a brief (1- to 2-page) description of your analyses. Be sure to address the following in your summary:
- Describe the results of each statement analysis. What do the results of each analysis mean?
- What does your complete financial statement analysis suggest about the financial health of the organization?
- If using your current organization’s data, does your analysis help describe any observed organizational behaviors or actions? Explain.
- What assumptions have you made in your analyses?
- From an entrepreneurial perspective, what implications do these analyses have for your proposed healthcare product or service?
Part III: Elevator Speech
Imagine that you have a limited amount of time during a meeting to convince organizational stakeholders that your proposed product or service will be a worthwhile investment. Create a 3- to 5-slide, narrated PowerPoint presentation of your elevator speech, incorporating selling points from your analyses that you believe make the business case for nurse entrepreneurship and leadership’s commitment to your proposed healthcare product or service.
Expert Solution Preview
In this assignment, we will be using the financial statements of Healthways to conduct a horizontal analysis and calculate the organization’s Return on Assets (ROA) over a span of 2-3 years. The purpose of this analysis is to evaluate the changes in revenue, expenses, and net earnings, and to assess the financial health of the organization. Additionally, we will explore the implications of these analyses from an entrepreneurial perspective and how they relate to a proposed healthcare product or service.
Question 1: Changes in Revenue, Expenses, and Net Earnings
To conduct a horizontal analysis, we will calculate the changes in revenue, expenses, and net earnings over the specified period of time using the following formulas:
Changes in Revenue = ((Current Revenue – Previous Revenue) / Previous Revenue) * 100
Changes in Expenses = ((Current Expenses – Previous Expenses) / Previous Expenses) * 100
Changes in Net Earnings = ((Current Net Earnings – Previous Net Earnings) / Previous Net Earnings) * 100
By applying these formulas, we will be able to determine the percentage change in each category over the given timeframe.
Question 2: Return on Assets (ROA)
To calculate the organization’s Return on Assets (ROA), we will use the following formula:
ROA = Net Earnings / Total Assets
By dividing the net earnings by the total assets, we can evaluate the effectiveness of the organization in generating profits with the available assets.
Question 3: Save and Submit Assessment
Once you have conducted the horizontal analysis and calculated the ROA, please save your assessment and submit it accordingly. Ensure that all calculations and findings are clearly presented.
In this section, we will create a brief description of the analyses conducted in Part 1. The summary will address the results of each statement analysis, the financial health of the organization, any observed organizational behaviors or actions, assumptions made in the analyses, and the implications for the proposed healthcare product or service from an entrepreneurial perspective.
1. Results of each statement analysis:
The results of the horizontal analysis for changes in revenue, expenses, and net earnings provide insights into the trends and growth patterns of the organization over the specified period of time. By calculating the percentage change, we can identify whether these categories have increased or decreased, which indicates the organization’s performance and financial stability.
2. Financial health of the organization:
Based on the complete financial statement analysis, the assessment provides an overall picture of the financial health of the organization. By closely examining the trends in revenue, expenses, and net earnings, we can determine whether the organization is growing, facing financial challenges, or maintaining a stable position.
3. Organizational behaviors or actions:
If using data from your current organization, the analysis may help in identifying any observed organizational behaviors or actions that have influenced the financial results. For example, if there was a significant increase in expenses, it may suggest an expansion of operations or an investment in new initiatives.
4. Assumptions made in the analyses:
Throughout the analysis, some assumptions may have been made to simplify calculations or interpret the data. These assumptions should be clearly stated and accounted for to ensure the accuracy and validity of the findings.
5. Implications for proposed healthcare product or service:
From an entrepreneurial perspective, the financial statement analysis provides valuable insights and implications for the proposed healthcare product or service. By understanding the organization’s financial health, potential investors or stakeholders can assess the viability and profitability of the proposed venture.
In this section, we will create a narrated PowerPoint presentation for the elevator speech, targeting organizational stakeholders to convince them of the worthiness of our proposed healthcare product or service. The presentation will incorporate selling points from the analyses conducted in Parts 1 and 2, highlighting the business case for nurse entrepreneurship and leadership’s commitment to the proposed venture.
The presentation will consist of 3-5 slides, incorporating concise and impactful information that showcases the financial strengths, market opportunities, and potential return on investment of the proposed healthcare product or service. The narrated PowerPoint will be structured to capture the stakeholders’ attention, convey the key selling points, address potential concerns, and emphasize the value proposition of the venture.
By conducting a thorough financial statement analysis, calculating the ROA, and creating an elevator speech, we can effectively evaluate the financial health of Healthways, make informed decisions about the organization’s viability, and present a compelling case for nurse entrepreneurship and leadership’s commitment to the proposed healthcare product or service.