Identifying and Coping with Balance Sheet Differences: A Comparative Analysis of U.S., Chinese and French Oil and Gas Firms Using the “Statement of Financial Structure”

Hervé Stolowy (First Author), Yuan Ding (Participant Author), Gary Entwistle (Participant Author)

Research output: Other contributionCase Studies

Abstract

At times in the globalized business world, it is necessary to compare companies across national boundaries. For example, in analyzing the oil and gas industry, a comparison may encompass firms headquartered in different countries. Such comparisons often use accounting information, e.g.comparing firms’ financial structures. While the harmonization of accounting continues to occur throughout the world, there remain differences in how accounting information is reported; this is especially the case with regard to the format or layout used in presenting balance sheets. Consequently, it is important that students be able to both identify such differences, and have a method for coping with them. Using three oil and gas companies located in three different countries (and continents),this case provides a setting for students to develop their ability to identify and cope with accounting differences. It also provides an opportunity for students to develop their financial analysis skills. Students are introduced to two templates: the Simplified Balance Sheet and the Statement of Financial Structure. They are required to work through various concepts of working capital, including working capital need (or “operating working capital”) and net cash. In working with these templates and working capital concepts, students should recognize that they can be applied irrespective of the firm’s balance sheet format (e.g. single- or multiple-step; decreasing or increasing liquidity).
Original languageEnglish
Number of pages15
Publication statusPublished - 1 Jan 2008

Case number

ACC-14-024

Case normative number

ACC-14-024-CE

Case type

Field

Update date

2016-07-02

Published by

China Europe International Business School

Keywords

  • Balance Sheet
  • Financial Structure Statement
  • International Difference

Case studies discipline

  • Accounting

Case studies industry

  • Mining, Quarrying, and Oil and Gas Extraction

Fingerprint

Dive into the research topics of 'Identifying and Coping with Balance Sheet Differences: A Comparative Analysis of U.S., Chinese and French Oil and Gas Firms Using the “Statement of Financial Structure”'. Together they form a unique fingerprint.

Cite this