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American Express Company- 2011 Fiscal Year
Main Sections of the Annual Report
The report contains a detailed review of the company’s fiscal year. This particular section has the executive overview that gives details of the activities carried out by the company. The paper also explains the various financial goals of the company. A financial summary of the financial performance is given and compared to that of the previous year. The report also gives critical accounting estimates where the company gives the structures that it has put in place to deal with some of the financial setbacks that they experienced during the fiscal year. Statistical information is also given on card member loans and receivables. This section also highlights the cash flow from investment and operation activities. Funding and capital strategies are also given.
The report contains the consolidated financial highlights of the year. The highlight is a comparison of the revenue of the 2011 fiscal year to that of 2010 fiscal year. The analysis shows a variance of more than 100%. Apart from the revenue, the highlight shows the company’s assets, number of employees and shares details. In relation to 2010, most the areas of the company have shown an increment. The area of cash dividend declared per share has been maintained at $0.72 from the previous year. The report also has notes on the consolidated report that give further explanation of the fiscal activities of the company.
Factors Influencing the Financial Performance
One of the factors that led to financial growth was the company’s efficiency and investment. The company decided to develop strategies that would enable them to take advantage of the competitive opening that had been created by the period of recession. Major focus was placed on new business opportunities and aggressive marketing and promotion strategies. The company involved itself with strategic acquisitions. Efficiency was also expressed in the company’s ability to control its expenses. This was through reducing costs and while increasing the quality of the services offered by the company employees.
The success of the company can also be attributed to their digital convergence. Digital convergence describes the ability to bring together the dimensions of commerce and the online world. The company has a virtual network that connects millions of its stakeholders and clients around the world. This kind of network has enabled the company to build relationships that have brought the success of the business.
Company’s Primary Assets
The company’s main assets are cash and its equivalent, receivables, short-term investments and prepaid expenses. Cash is the company’s liquid asset. This is in the returns that the company receives as profit. The cash assets of the company are also present in the cash that is due from banks. The company also has receivables from the card members. These particular receivables are securitized by transferring them to trusts. Prepaid expenses are also some of the assets that the company has. These are like miles and reward points acquired from partners with transportation companies. The short-term investments are in form of the company’s restricted cash that has been held for asset maturities.
Management’s Control of the Internal Environment
The company has an effective internal environment control structure. The efficiency of the company is according to a report given by Pricewaterhousecoopers. The financial statements and records give a correct reflection of the financial position of the business. Transactions of the company are also recorded to ensure that they aid in efficient financial reporting. The company provided assurance concerning detection of unlawful use of assets belonging to the company.
Reference list
American Express Company (2012). 2011 Annual Report. Retrieved from http://ir.americanexpress.com
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