Accounting 강의 수강 중 제출한 Bausch & Lomb, Inc. 케이스 스터디입니다. (영문 3P)
Lamex의 U.S. Sunglasses and Contact Lenses Division과 Hong Kong Division (APD)의 비교과
재무 자료 분석을 통해 sales decrease, profit margin, 와 inventories 문제를 분석한
A. U.S. Sunglasses and Contact Lenses Division
B. Hong Kong Division (APD)
3. FINANCIAL STATEMENT ANALYSIS
From 1993 Bausch & Lomb faced up seriously to three main issues: sales decrease, profit margin, and inventories. In order to match the targets and the actual performances, some divisions were forced to manipulate the financial reports and even to take illegal decisions. We’re going to analyze these manipulations according to the three mainly involved divisions and to the company’s financial reports.
Latin America was a very charming market for B&L: a lot of customers were willing or used to pay for cash, cash equivalents or third party checks for a pair of $50,000 Ray-Ban Sunglasses. B&L’s Latin American Export subsidiary LAMEX not only enjoyed $25 million sales, but it could also get a chance to do possible wrongdoings such as money laundering. In fact, cash payments were hard to be tracked and attributed to a specific market, so LAMEX could enter into the European gray market, and B&L headquarters couldn’t realize it because every movement was made by cash payments.
U.S. Sunglasses and Contact Lenses Division
In 1993 the Sunglasses Division decided to face up the decrease in sales through end-of-period promotions. To the distributors willing to accept larger stocks of sunglasses, B&L would have offered some incentives, such as 90-day payment terms instead of 30-day, 30% rebates, and extended deadlines on invoices due