EXXONMOBIL

EXXONMOBIL

Abstract

This project analyses financial performance and position by evaluating respective profit, loss and consolidation balance sheet of three worldwide oil companies Exxon Mobil Corporation. The authors use three years' (2007-2009) consolidated financing data of these companies as backup in the models to perform a comparative exercise and access the relative performance of financial accounting events. Vertical and horizontal analysis were used to evaluate companies' financial performance and position, the application of the ratios analysis technique to financial statements offers potential in expanding insight into specific strengths and weaknesses of a companies' financial situation. This article aims to accurately understand the meaning and functions of financial accounting analysis methods, and to comprehend the role of financial accounting in business decision-making accordingly.

Corporate Profile

ExxonMobil Corporation, formerly named Exxon Corporation, was incorporated in the State of New Jersey in 1882. On November 30, 1999, Mobil Corporation became a wholly-owned subsidiary of Exxon Corporation, and Exxon changed its name to ExxonMobil Corporation. ExxonMobil Corporation has several divisions and hundreds of affiliates, many with names that include ExxonMobil, Exxon, Esso or Mobil. ExxonMobil is the one of world's largest integrated oil company. Exxon Mobil engages in oil and gas exploration, production, supply, transportation, and marketing around the world. It has proved reserves of 21.2 billion barrels of oil equivalent. ExxonMobil's 45 refineries in 25 countries have a capacity of producing 6.3 million barrels per day.

Overview

The profits and expenses analysis (Income statement review)

ExxonMobil's total revenue increased 20.7% in 20x3 and 20.8% in 20x4. For the other income in 20x3 was the highest point contrast to the other two years, it has made corporation's profit looks pretty good. Net profits from the original activity before taxation were up82.6% in 20x3 and grown 29% in 20x4.

Moreover, ExxonMobil's net income has significant jumped up 87.7% in the year 20x3, and raised 17.8% in 20x4 compared to previous year. Because the total cost in 20x3 grew slower then 20x2, the management economized variety expenses carefully, and thus, the total cost has no greater changes in the year.

Elucidation of Assets structure. (Balance sheet review)

In 20x4, the current asset, note and account receivable was the largest item recorded in 20x4, having 42%, it was slight shift compare to 20x3 but bigger to 20x2, which has increased 31.5%. The percentage of cash and cash equivalents was the second largest item of current asset in 20x4, which having 30.7%, the relevant rate in 20x3 and 20x2 were 23% and 19% respectively, it indicate ExxonMobil had much more cash and deposits in 20x4 compared to the previous years.

Elucidation of liabilities and shareholders' equity

In 20x2 to 20x3, the percentage of the current liabilities decreased from 41% to 37.5%. In 20x3 to 20x4, the percentages of the current liabilities decreased from 37.5% to 36.4%. The percentage of long-term liabilities increased from 9.8% to 10.4% in 20x2 to 20x3, and decreased from 10.4% to 10% till 20x4. In 20x2 to 20x4, total liabilities always increased as time goes on.

Evaluation of profits (Income statement review)

Group's revenue and net ...