Davis and Williams Case Study

Davis and Williams Case Study

Instructions: You will be answering two questions.

  1. In 1 – 2 paragraphs discuss the purpose, style, and format of a memorandum. Also, list at least five helpful tips for writing memorandums.
  2. In 1 – 2 paragraphs, Discuss the differences between defining, analyzing, and synthesizing. Use the assignment highlighted below to discuss Which should be used in the memorandum for this assignment? Why?



Assignment Objective : (1) To become familiar with performance measures used to analyze not-for-profit organizations; and (2) To demonstrate an ability to communicate analytical findings.

Assignment: The accounting firm of Davis and Williams has decided to start supporting a worthy charity. The partners want to select an organization that makes good use of its resources to meet its standard mission. Davis and Williams Case Study

Required: Select two charities of interest under a common theme (healthcare, cancer research, poverty, animals, environment, etc.), read the information available on the website, and print copies of the organization’s current audited financial statements. Be sure to have the same year for both organizations. Calculate the following ratios (and others you may want to include) to use when evaluating your organizations:

From the Statement of Financial Position assess the following:

  1. Liquidity – current ratio*
  2. % of Unrestricted Net Assets – unrestricted net assets to the total net assets.

From the Statement of Activities, assess the following:

  1. Going Concern – revenues divided by expenses*
  2. Fund Raising Efficiency – public support divided by fundraising expenses*
  3. Program Effectiveness – percentage of program expenses to total expenses.
  4. % of Fundraising Expenses – percentage of fundraising expenses to total expenses
  5. % of Management Expenses – percentage of management expenses to total expenses.

Write a 1 page memorandum to the partners of Davis and Williams. Briefly describe the charities you selected (1-2 sentences only) and your recommendation of which charity they should support. Give adequate justification for your recommendation.  Note that the memorandum should focus on your analysis and not a summary of the organizations. You are not required to discuss each ratio but you should discuss the distinguishing ones.


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