Nintendo Financial Statements

Introduction

Nintendo financial statements are lacking corporate social responsibility, which is important in the modern corporate world. This information is vital for the current corporate world Social responsibility. Take two interactive software as a section of social responsibility. Corporate social responsibility is described below.

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Social responsibility concerning the management of corporate is defined as duties and moral obligations of corporate to other stakeholders. Corporate social responsibility is moral rights, wrongs, and obligations for business managers for any business transaction or decision. The moral responsibility of corporate depends on the nature of business and the individuals involved

Business organizations have adopted various ethical policies because they believe in showing the neighborhood their moral responsibility and in the process they have increased their sales.

Corporate social responsibility like any other concept is to be discussed in broad terms. The idea of corporate social responsibility was introduced in 1973 when it was introduced in American corporations. Its basic premises of ethical obligation have made managers and shareholders own self-interest in business transactions. Every business manager who incurs business transactions will put society goals and aspirations in the front.

Basic theories

Corporate social responsibility revolves around four basic theories which will include social contract theory (contractual relation), social justice theory (equitable distribution of resources), rights theory rights of community where the company is operating) and deontological theory.

  • Social contract theory: This theory assumes that there are many contracts both explicit and implicit between individuals, organizations, and institutions. Social contracts evolve around whims of trust and are made in harmony. Corporations are assumed to the business world by entering into contracts with the society in exchange for resources and acceptance to operate without interruption.
  • Social Justice Theory: This examines the fairness in the distribution of societal goods and services. The theory puts forward arguments that societies are considered, by way of distributing social goods. Corporate managers have a responsibility in ensuring these goods have been appropriately being shared in society.
  • Rights theory: This theory deals concentrate on the rights of various members of the society like human rights and other rights. Corporate managers should not interfere with the property rights and human rights of members of society. The corporation will have property rights that should not be used to affect the rights of employees and the local community.
  • Deontological theory: This theory assumes that everybody is equal and should be treated with respect and everybody has a moral duty to that effect. This belief is for everyone, including corporate managers, shareholders, and other stakeholders. Corporate social responsibility gives reasons why managers

This is shown from statements of taking two interactive software about the employee section Directors and Executive Officers of the Registrant, Executive Compensation, Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. however, this information is lacking Nintendo financial statement

In analyzing the financial statement, the following ratios have been calculated for comparison purposes

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Table 1. Financial Performance

Ratio Formulae Nintendo Take two interactive s/w inc
Return on Assets Net Profitx100% Total Assets 160759 x100
1160703
13%
21832 x100
908361
2.4%
Return on Equity Net Profitx100% Total Equity 98378 x100
974091
10%
18861 x100
637225
3%
Asset turn over Turn over
Total Assets
509249
1160703
0.4 times
306779
908361
0.34 times
Current Ratio Current Assets
Current liabilities
1018730
182274
5.6times
572404
270733
2.1 times
Quick ratio Current Assets-stockCurrent liabilities 1018730-30835
182274
5.4times
572404-91820
270733
1.7 times
Debt to Equity Total Debts
Equity
186435
974091
0.19times
271136
637225
0.4 times

From the table above analyzing the performance of the two companies, we realize that Nintendo was performing poorly in terms of working capital management. As they have huge working reserves in hand without investing them. They also have a better credit ratio as they can pay their creditors, and meet short-term obligations. This shows that they are not exploiting credit facilities well.

On the other hand, Take two interactive software to have good ratios in terms of working capital management. When it comes to solvency, they are doing excellent because the ratio stands at 0.4 times, which is not too much. it shows that the company is utilizing credit facilities well unlike the other one.

Conclusion

Based on the debt ratio, and if Nintendo is to finance the venture through external borrowings (debt), then it would be advisable to do so. This is because they have not utilized debt capital well which not a good debt management policy is. However, the management of the company is not efficiently utilizing the current equity as shown by a decline in the return to equity over two years. The management seems not to be aware of the excess funds lying idle. The directors should think of injecting new blood into the company.

References

  1. Sanzo R, (2005) Ratio Analysis for small Business, Yale University Publishers, USA.
  2. Vandyck C, (2006) Financial ratio analysis, Wiley books, USA
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StudyCorgi. (2021, September 12). Nintendo Financial Statements. Retrieved from https://studycorgi.com/nintendo-financial-statements/

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"Nintendo Financial Statements." StudyCorgi, 12 Sept. 2021, studycorgi.com/nintendo-financial-statements/.

1. StudyCorgi. "Nintendo Financial Statements." September 12, 2021. https://studycorgi.com/nintendo-financial-statements/.


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StudyCorgi. 2021. "Nintendo Financial Statements." September 12, 2021. https://studycorgi.com/nintendo-financial-statements/.

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StudyCorgi. (2021) 'Nintendo Financial Statements'. 12 September.

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