Wal-Mart Accounting Analysis

Wal-Mart Accounting Analysis

Overview of Wal-Mart

Wal-Mart Stores Inc. is one of the leading retailers in different formats across the globe. The business is committed to save money of people all around in order to offer them better living. The business has earned the trust of wide range of customers by delivering them a wide variety of excellence of goods as well as services at everyday low price. Mainly, the business operates in 3 key areas including the Walmart International segment, the Walmart U.S. segment, and the Sam's Club segment. Throughout the financial year 2012, the Walmart U.S. segment reported for around 60 percent of the total sales while operating retail outlets in different formats in approximately all the 50 states of the United States of America as well as Purto Rice, and the online retail operations of Walmart, walmart.com. On the other hand, the International segment of Walmart comprises of retail operations in twenty six nations, and throughout 2012, the segment produced around 28 percent of its net sales. This segment consist of wide range of retail outlets formats, restaurants, online retailing operations, as well as Sam's Club that operations outside the America (Reuters, 2013).

Furthermore, the segment of Sam's Club comprises of association storehouse alliances operating in 47 regions of the America as well as Puerto Rico, and the online retailing processes, samclub.com. This segment accounted for around 12 percent of the net sales during the fiscal year 2012. The organization is involve in variety of operations of retail outlets established all around the United States, as well as its wholly owned subsidiaries in Canada, Argentina, China, Brazil, and several other regions or states. The U.S. segment of walmart involves the mass merchant concept of the business under Walmart or walmart.com, as well as Walmart brand. On the other hand, the worldwide segment of Walmart comprises of business operations outside the America, and the segment of Sam's Club involves the clubs of warehouse membership in the America, as well as samsclub.com (Reuters, 2013).

Financial Outlook of Wal-Mart

The performance metrics of Walmart focuses on three key factors in order to enhance the value of stockholders|: leverage, growth, and returns. Wlamart's emphasize on growth focuses on sales via comparable stores as well as club sales and unit square feet growth, where, the emphasis on leverage includes the firm's target to raise its operating income at a rapid pace as compared to the growth in total sales through development of its selling, operating, administrative and general expenses (operating expenses) at a slower pace as compared to the expansion of its total sales. The emphasis on returns focuses on the efficiency level of the firm in employing its assets via return on investment (ROI) as well as the effectiveness of the business in managing working capital via free cash flow (Walmart Annual Report, 2012.

The consolidated net sales of Walmart increased by 5.9 percent and 3.4 percent in the financial period of 2012 and 2011, respectively, as compared to previous financial ...