Financial Analysis of Telecom Sector

1. COMPLETE ANALYSIS OF ANNUAL REPORTS OF VARIOUS COMPANIES IN THE TELECOM SECTOR
Prepared By:
Group No. 5, Section A

2. a) Assessing the quantum and quality of disclosures
1. Extent of overall disclosures of Selected Companies:
Different disclosures in the financial statements are as follows:
Vodafone:
Mandatory Voluntary
Basis of preparation Yes No
Accounting for subsidiaries Yes No
Acquisition of interests from non-controlling shareholders Yes No
Interests in joint ventures No Yes
Investments in associates Yes No
Intangible assets Yes No
Licence and spectrum fees No Yes
Computer software No Yes
Property, plant and equipment Yes No
Impairment of assets Yes No
Revenue Yes No
Inventory Yes No
Leasing Yes No
Foreign currencies Yes No
Commissions No Yes
Post employment benefits Yes No
Taxation Yes No
Provisions Yes No
Share-based payments Yes No
Telstra:
Mandatory Voluntary
Basis of preparation of the financial report Yes No
Clarification of terminology used in our income statement No Yes
Rounding No Yes
Changes in accounting policies Yes No
Foreign currency translation Yes No
Cash and cash equivalents Yes No
Trade and other receivables Yes No
Inventories Yes No
Construction contracts No Yes
Investments Yes No
Impairment Yes No
Property, plant and equipment Yes No
Leased plant and equipment Yes No
Intangible assets Yes No
Trade and other payables Yes No

3. Provisions No Yes
Borrowings Yes No
Share capital Yes No
Revenue recognition Yes No
Taxation Yes No
Earnings per share Yes No
Post-employment benefits Yes No
Employee Share Plans Yes No
Derivative financial instruments No Yes
Contingent Liabilities No Yes
Verizon:
Mandatory Voluntary
Basis of Presentation Yes No
Earnings Per Common Share Yes No
Cash and Cash Equivalents Yes No
Marketable Securities Yes No
Maintenance and Repairs No Yes
Advertising Costs No Yes
Inventories Yes No
Plant and Depreciation Yes No
Computer Software Costs No Yes
Income Taxes Yes No
Foreign Currency Translation Yes No
Employee Benefit Plans Yes No
Derivative Instruments No Yes
Stock-Based Compensation Yes No
Idea:
Mandatory Voluntary
Basis of Preparation of Financial Statements Yes No
Fixed Assets Yes No
Expenditure during pre-operative period of license No Yes
Depreciation and Amortisation Yes No
Inventories Yes No
Foreign currency transactions, forward contracts & other
Yes No
derivatives
Taxation Yes No
Retirement Benefits Yes No
Revenue Recognition and Receivables Yes No
Investments Yes No
Borrowing Cost No Yes
License Fees-Revenue Share No Yes
Use of Estimate No Yes
Leases Yes No

4. Earnings Per Share Yes No
Impairment of Assets Yes No
Provisions & Contingent Liability No Yes
Issue Expenditure No Yes
Employee Stock Option Yes No
1.1 Identify such disclosures - voluntary and mandatory- that are done only by the one of
the four companies?
Vodafone:
Unique mandatory disclosures:
Accounting for subsidiaries
Acquisition of interests from non-controlling shareholders
Unique voluntary disclosure:
Interests in joint ventures
Telstra:
Unique mandatory disclosures:
Changes in accounting policies
Unique voluntary disclosures:
Clarification of terminology used in our income statement
Rounding
Construction contracts
Derivative financial instruments
Contingent Liabilities
Verizon:
Unique mandatory disclosures:
Marketable Securities
Unique voluntary disclosures:
Borrowing Cost
Advertising Costs
Idea:
Unique voluntary disclosures:
Maintenance and Repairs
Issue Expenditure
1.2 Are these omitted disclosures important to the decision making process of any of the
constituencies interested in the four companies?
The voluntary disclosures and some mandatory disclosures like Accounting for subsidiaries and
changes in accounting policies may not be applicable but some mandatory disclosures like
Marketable Securities is important to better analyse the company’s financial statements.

5. 2. Compare the quality of various disclosures
2.1 Revenue Recognition:
VODAFONE
Determining the fair value of each deliverable can require complex estimates due to the nature of
the goods and services provided. The Group generally determines the fair value of individual
elements based on prices at which the deliverable is regularly sold on a standalone basis after
considering volume discounts where appropriate.
TELSTRA
 Rendering of services-straight line basis over the period of service provided, unless another
method better represents the stage of completion.
 Sale of goods-This revenue is recorded on delivery of the goods sold.
 Rent of network facilities-The revenue from providing access to the network is recorded on
an accrual basis over the rental period.
 Construction contracts-Telstra records construction revenue and profit on a percentage of
contract completion bases. The percentage of completion is calculated based on estimated
costs to complete the contract.
 Advertising and directory services-Classified advertisements and display advertisements are
published on a daily, weekly and monthly basis for which revenues are recognised at the
time the advertisement is published. All of our Yellow Pages and White Pages directory print
revenues are recognised on delivery of the published directories to customers’ premises.
Revenue from online directories is recognised over the life of service agreements, which is
on average one year. Voice directory revenues are recognised at the time of providing the
service to customers.
 Royalties-Royalty revenue is recognised on an accrual basis in accordance with the
substance of the relevant agreements.
 Interest revenue-Telstra records interest revenue on an accruals basis. For financial assets,
interest revenue is determined by the effective yield on the instrument.
 Revenue arrangements with multiple deliverables- The Company allocates the
consideration from the revenue arrangement to its separate units based on the relative
selling prices of each unit. If neither vendor specific objective evidence nor third party
evidence exists for the selling price, then the item is measured based on the best estimate of
the selling price of that unit.
 Government grants- Grants from the government are recognised at their fair value where
there is a reasonable assurance. Government grants relating to costs are deferred and
recognised in the profit or loss over the period necessary to match them with the costs that
they are intended to compensate. Government grants relating to the purchase of property,
plant and equipment are included in noncurrent liabilities as deferred income and are
credited to profit or loss on a straight line basis over the expected lives of the related assets.
The benefit of a government loan at a below-market rate of interest is treated as a
government grant. The loan is measured at amortised cost.

6. VERIZON
On January 1, 2011, Verizon prospectively adopted the accounting standard updates regarding
revenue recognition for multiple deliverable arrangements, and arrangements that include software
elements. These updates require a vendor to allocate revenue in an arrangement using its best
estimate of selling price if neither vendor specific objective evidence (VSOE) nor third party evidence
(TPE) of selling price exists. The residual method of revenue allocation is no longer permissible.
These accounting standard updates do not change our units of accounting for bundled
arrangements, nor do they materially change how the company allocates arrangement consideration
to our various products and services. Accordingly, the adoption of these standard updates did not
have a significant impact on our consolidated financial statements. Additionally, the company does
not currently foresee any changes to our products, services or pricing practices that will have a
significant effect on our consolidated financial statements in periods after the initial adoption,
although this could change.
IDEA
Revenue on account of telephony services (mobile & long distance) and sale of handsets and related
accessories are recognized net of rebates, discount, service tax, etc. on rendering of services and
supply of goods respectively. Recharge fees on recharge vouchers is recognized as revenue as and
when the recharge voucher is activated by the subscriber. Service Income from Passive
infrastructure is recognized on accrual basis (net of reimbursements) as per the contractual terms on
straight line method over the contract period. Unbilled receivables, represent revenues recognized
from the bill cycle date to the end of each month. These are billed in subsequent periods as per the
agreed terms. Debts (net of security deposits outstanding there against) due from subscribers, which
remain unpaid for more than 90 days from the date of bill and/or other debts which are otherwise
considered doubtful, are provided for. Provision for doubtful debts on account of interconnect usage
charges (IUC), roaming charges and passive infrastructure sharing from other telecom operators is
made for dues outstanding more than 180 days from the date of billing other than cases when an
amount is payable to that operator or in specific case when management is of the view that the
amount is recoverable.
2.1.1 What are the revenue recognition policies of four companies? Are these policies unusual in
anyways?
Revenue recognition policies of four companies are different for different items. No these policies
are not unusual in anyways but few companies has not disclosed anything eg. Like VODAFONE and
VERIZON have not given any information.
2.1.2 Whose policy is easy to understand and is consistent with the way company is carrying out
its business? Are these policies justified in terms of their risks and advantages? Do these policies
make the reported revenue numbers more conservative or less conservative?
TELSTRA’s policy is easy to understand and is consistent with the way company is carrying its
business. Yes these policies are justified in terms of their risks and advantages. It doesn’t seem to be
aggressive or at the same the same time they are not more conservative or less conservative.

7. 2.1.3. Has it provided any justification for the same?
VERIZON company changed its policy in the recent year (On January 1, 2011) it provided justification
provided is (the company prospectively adopted the accounting standard updates regarding revenue
recognition for multiple deliverable arrangements, and arrangements that include software
elements. These updates require a vendor to allocate revenue in an arrangement using its best
estimate of selling price if neither vendor specific objective evidence (VSOE) nor third party evidence
(TPE) of selling price exists. The residual method of revenue allocation is no longer permissible.
These accounting standard updates do not change our units of accounting for bundled
arrangements, nor do they materially change how the company allocate arrangement consideration
to our various products and services. Accordingly, the adoption of these standard updates did not
have a significant impact on our consolidated financial statements.
2.2. Depreciation policy:
2.2.1. How four companies are depreciating there assets? Are the policies of two companies
consistent with the way they carry out their businesses?
IDEA
Depreciation on fixed assets is provided on straight-line method (except stated otherwise) on pro-
rata basis on their estimated useful economic lives. Intangible Assets are amortised on straight-line
method as under:-
i) Cost of Rights, Licences including the fees paid on fixed basis prior to revenue share regime and
Spectrum fee is amortised on straight-line method on commencement of operations over the
validity period.
ii) Software, which is not an integral part of hardware, is treated as an intangible asset and is
amortized over its useful economic life as estimated by the management between 3 to 5 years.
iii) Bandwidth / Fibre taken on Indefeasible Right of Use (IRU) is amortised over the agreement
period. Assets costing up to 5,000/- are depreciated fully in the month of purchase.
VODAFONE
Land and buildings held for use are stated in the statement of financial position at their cost, less any
subsequent accumulated depreciation and subsequent accumulated impairment losses.
Equipment, fixtures and fittings are stated at cost less accumulated depreciation and any
accumulated impairment losses.
Assets in the course of construction are carried at cost, less any recognised impairment loss.
Depreciation of these assets commences when the assets are ready for their intended use.
The cost of property, plant and equipment includes directly attributable incremental costs incurred
in their acquisition and installation.
Depreciation is charged so as to write off the cost of assets, other than land and properties under
construction, using the straight-line method, over their estimated useful lives, as follows:

8. Freehold buildings 25 – 50 years
Leasehold premises the term of the lease
Equipment, fixtures and fittings:
Network infrastructure 3 – 25 years
Other 3 – 10 years
Depreciation is not provided on freehold land.
Assets held under finance leases are depreciated over their expected useful lives on the same basis
as owned assets or, where shorter, the term of the relevant lease.
The gain or loss arising on the disposal or retirement of an item of property, plant and equipment is
determined as the difference between the sale proceeds and the carrying amount of the asset and is
recognized in the income statement.
TELSTRA
Items of property, plant and equipment, including buildings and leasehold property, but excluding
freehold land, are depreciated on a straight line basis to the income statement over their estimated
service lives. The company start depreciating assets when they are installed and ready for use
VERIZON
Verizon also follows only straight line depreciation and left for very few exceptions for items of
plant, property and equipment.
2.2.2. Has anyone of the companies changed its depreciation policy in the recent years? Has it
provided any justification for the same?
As far from the annual reports there is no evidence that any of the company has changed the
methods of depreciation.
2.2.3. Are there policies conservative or aggressive or moderate?
No company seems to be very aggressive, more or less conservative. All the companies have only
followed straight line depreciation method only except for few exceptions. They are moderate.

9. 2.3. Fixed Asset Accounting:
2.3.1. Which model Cost vs. Revaluation companies are following for their various asset classes?
None of the four companies have mentioned anything in their financial statements about
revaluation of fixed assets.
Telstra have mentioned that they have suffered some losses due to revaluation of non fixed
assets like equity, derivatives, transactions either not designated or de-designated from fair
value hedge relationships; on the other hand they have non cash revaluation gains which are
primarily due to a strengthening of the Australian dollar.
2.3.2. If a company is following revaluation model for any of its asset classes, is it keeping the
value of its assets updated?
Telstra is updating their non fixed assets and non cash revaluation gains every year.
2.3.3. Are the reasons for revaluation/impairment of company’s assets adequately disclosed?
Yes all the four companies have disclosed the adequate reasons for their impairment and
revaluation (if any).
2.3.4. Is the basis used for arriving at revaluation estimates disclosed?
Telstra have clearly mentioned the basis of how it arrived at the revaluation estimates like non cash
revaluation gains which are primarily due to a strengthening of the Australian dollar, some losses
due to revaluation of non fixed assets like equity, derivatives, transactions either not designated or
de-designated from fair value hedge relationships.
2.3.5. Is the company depending on external valuation expert or in-house valuation expertise?
All the companies are doing their in-house valuation
2.3.6. Is there any Indian or global company belonging to the firm industry which has done
revaluation of its plant and equipment during recent year?
No, none of these companies have done any kind of revaluation of its plant and equipment during
recent year
2.3.7. Has anyone of the companies changed its policy in the recent years? Has it provided any
justification for the same?
There are few changes that have been by all the companies except IDEA cellular in current financial
year.
Verizon: Adopted the accounting standard updates regarding revenue recognition for
multiple deliverable arrangements, and arrangements that include software elements.
No justification provided
Vodafone: On 1 April 2011 the Group adopted new accounting policies to comply with:
 “Improvements to IFRS” issued in May 2010.
 Amendments to IAS 24 “State-controlled entities and the definition of a related
party”.

10.  Amendments to IFRIC 14 “Prepayments on a minimum funding requirement”.
 IFRIC 19 “Extinguishing financial liabilities with equity instruments”.
No justification required as they have been amended as per the changes in the existing
rules of different authority that being followed by the company.
Telstra: There are few amendments made by Telstra like
 AASB 136: “Impairment of Assets”
 AASB 107: “Statement of Cash Flows”
 AASB 1054: “Australian Additional Disclosures”
Proper justification has been provided for the amendments.
2.4 Inventory Valuation Policy:
2.4.1. What Inventory valuation policies four companies have?
All four companies determine the inventory value as the lower of cost and market value. The cost is
evaluated as:
Company Inventory Valuation Policy
Vodafone weighted average cost
Telstra Inventory: weighted average cost
Directories: FIFO
Verizon not clearly mentioned, states either of weighted average cost or FIFO
Idea weighted average cost
2.4.2. Are these policies consistent in all the recent years?
Their policies are consistent and there has been no change mentioned in the financial report.
2.4.3. Are these policies consistent with the way company carries out its business?
Majority of the companies using mainly weighted average cost or FIFO at times, as the means of
inventory evaluation is consistent with the accounting policies of the respective countries and the
way they perform their business.
2.4.4. Do these policies make the reported numbers more conservative or less conservative?
All the four companies use weighted average as the means of evaluation of majority of its
inventories is neither more or less conservative means of reporting. Only, Telstra’s use of FIFO in
creation of directories can be stated as a more conservative method of reporting.
2.4.5. Has anyone of the companies changed its policy in the recent years? Has it provided any
justification for the same?
None of the companies have changed any policy in any recent year.

11. 2.5. Deferred Tax:
2.5.1. Identify the drivers of differed tax assets and liabilities of the four countries?
Company Deferred Tax Assets Deferred Tax Liability
Vodafone Tax losses Accelerated tax depreciation
Deferred tax on overseas earnings
Other short-term temporary differences
Telstra Provision for employee entitlements Property, plant and equipment
Revenue received in advance Intangible assets
Provision for workers' compensation Borrowings and derivative financial
Allowance for doubtful debts instruments
Defined benefit liability/asset
Trade and other payables
Verizon Employee benefits Former MCI intercompany accounts
Tax loss and credit carry forwards receivable basis difference
Uncollectible accounts receivable Depreciation
Valuation allowances Leasing activity
Wireless joint venture including wireless
licenses
Idea Provision for Doubtful Debts Depreciation & Amortisation
Expenses allowable on payment basis
Brought Forward Losses
2.5.2. Has company estimated to which extent the deferred tax asset is recoverable?
None of the companies shows any estimates or calculations on the recovery of the deferred tax
assets.
2.5.3. Which company’s deferred tax footnote is more informative and comprehensive?
Whereas all companies give a fairly good idea about deferred taxes, it is only Vodafone that has the
most non-comprehensive explanation for deferred taxes. Out of the others, it is M/s Telstra yet
again that most comprehensively indicates the various components encapsulating the deferred
taxes.
b) Assessing the Fundamentals:
1. Vertical common size statement analysis over latest two years:
Vodafone:
Balance Sheet
2011 2010
(£m) (£m)
Cash and Cash Equiv 6,252 4,423
Account receivable 9,259 8,784
Inventories 537 433
Other current Assets 955 579
Total Current Assets 17,003 14219

12. Net Property, Plant, Equipment 20,181 20,642
Other Long Term Assets 1,34,217 142766
Total Assets 1,51,220 1,56,985
Total Current Liabilities 27,075 28,616
Long Term Debt 28,375 28,632
Other Long Term Liabilities 8,209 8,927
Preferred Share N/A N/A
Total Equity Capital 87,561 90,810
Total Liability and Equity 1,51,220 1,56,985
Income Statement
2011 2010
(£m) (£m)
Net Revenue 45,884 44,472
Less: Cost of Sales (40,288) (34,992)
Other income and (Expenses) 4331 706
interest expense (429) (1512)
Earnings Before Income Tax 9,498 8674
Less: Income Taxes (1,628) (56)
Adjustments NA NA
Net Profit 7,870 8,618
Telstra:
Balance Sheet of Telstra
2011 2010
($m) ($m)
Current Assets
Cash and Cash Equiv 2630 1936
Account receivable
Inventories
Other current Assets 4823 5249
Total Current Assets 7453 7185
Net Property, Plant, Equipment 21790 22894
Other Long Term Assets 8670 9203
Total Assets 37913 39282
Total Current Liabilities 8538 8682
Long Term Debt 12178 12370
Other Long Term Liabilities 4905 5222
Preferred Share 12074 12696
Total Equity Capital 12292 13008
Total Liability and Equity 37913 39282

13. Income Statement
2011 2010
($m) ($m)
Net Revenue 25304 25029
Less: Cost of Sales
Other Expenses 5047 5117
Interest Expense
Total Expense 15154 14184
Earnings Before Income Tax 4557 5538
Less: Income Taxes 1307 1598
Adjustments N/A N/A
Net Profit 3250 3940
Verizon:
Balance Sheet
2011 2010
($m) ($m)
Cash, Cash Equiv, Market sec 13954 7213
Accounts Receivables 11776 11781
Inventories 940 1131
Other Current Asset 4269 2223
Total Current Asset 30939 22348
Net Property, Plant and Equipment 88434 87711
Other Long-term Asset 111088 109946
TOTAL ASSETS 230461 220005
Total Current Liabilities 30761 30597
Long Tern Debt 50303 45252
Other Long Term Liability 63489 57244
Preferred Share N/A N/A
Total Equity Capital 85908 86912
Total Liability and Equity 230461 220005
Income Statement
2011 2010
($m) ($m)
Net Sales 110875 106565
Less: Cost of Sales (97995) (91920)
Other Income and (Expenses) 430 562
Interest Expenses (2827) (2523)
Earnings before Tax 10483 12684
Less: Income Tax (285) (2467)
Net Earnings after Tax 10198 10217

14. Idea:
Balance Sheet
2012 2011
(Rs mn) (Rs mn)
Current Assets
Cash and Cash Equiv 1341 4515
Account receivable 8075 5347
Inventories 529 522
Other current Assets 17.68 8.08
Total Current Assets 23883 29470
Total Fixed Assets 285957 256810
Total Assets 309840 286280
Total Current Liabilities 82937 80807
Long Term Debt 86121 75857
Other Long Term Liabilities 11677 7065
Total Liabilities 180494 162973
Preferred Share N/A N/A
Total Equity Capital 129345 123307
Total Liability and Equity 309840 286280
Income Statement
2012 2011
(Rs mn) (Rs mn)
Income
Net Revenue 193223 153889
Less: Cost of Sales 171591 147565
Other Expenses 4132 3837
Interest Expense 9078 2487
Earnings Before Income Tax 8422 9063
Less: Income Taxes 2657 618
Adjustments N/A N/A
Net Profit 5765 8445

15. 1.2 Ratio Analysis:
Vodafone Telstra Verizon Idea
2011 2010 2011 2010 2011 2010 2012 2011
Liquidity, Efficiency
and Solvency Ratio:
Current Ratio 0.6279 0.4968 0.8729 0.8275 1.0058 0.7303 0.2879 0.3646
Quick Ratio 0.5728 0.4615 0.3080 0.2230 0.4536 0.2357 0.1809 0.2230
Avg. Collection 72 23 NA NA 39 40 15 13
Period
Days Inventory 6 5 NA NA 4 4 1.1 1.3
Days Payable 9.6 10 48 65 114 122 174 202
Debt-Equity ratio 7.9549 3.4447 0.9907 0.9509 1.3246 1.1793 0.7542 0.6664
Profitability Ratio:
GPM 0.3284 0.3380 0.1801 0.2213 0.1162 0.1374 0.2224 0.2043
NPM 0.1715 0.1938 0.1284 0.1574 0.0945 0.119 0.0438 0.0592
Return on common 0.0885 0.0949 0.2569 0.3029 0.1213 0.1468 0.068 0.0737
equity(ROE)
DuPont Analysis 0.172* 0.194* 0.1284 0.1574 0.0945* 0.119* 0.0438 0.0592
0.298* 0.283* *0.655 *0.637 0.4811* 0.484* *0.624 *0.536
1.728 1.729 *3.051 *3.02 2.6826 2.5313 *2.395 *2.322
Telstra and Vodafone have better liquidity, with Vodafone displaying better true liquidity with higher
quick ratio.
Idea shows best efficiency both for collection and payable.
Vodafone has highest debt-equity ratio and Idea has lowest.
Telstra and Vodafone show the highest true profitability with Telstra capturing the highest returns
on true profitability.

16. 1.3 Cash Flow Statement Analysis:
Cash Flow Statement of Verizon($ mn)
Years 2011 2010 2009
Operating Activities 29780 33363 31390
Investing Activities -17250 -15054 -23156
Financing Activities -5836 -13650 -16007
Increase (Decrease) In Cash and
Cash Equivalents 6694 4659 -7773
Cash Flow Statement of Vodafone( Pounds mn)
Years 2011 2010 2009
Operating Activities 12755 11995 13064
Investing Activities 3843 -1882 -7437
Financing Activities -15369 -8259 -5853
Increase (Decrease) In Cash and
Cash Equivalents 1229 1854 -226
Cash Flow Statement of Telstra($ mn)
Years 2011 2010
Operating Activities 8018 9691
Investing Activities -2541 -3466
Financing Activities -4873 -5481
Increase (Decrease) In Cash and
Cash Equivalents 604 744
Cash Flow Statement of IDEA(Rs mn)
Years 2012 2011
Operating Activities 30550.11 45230.33
Investing Activities -43663.5 -78268.04
Financing Activities 577.5 33148.31
Increase (Decrease) In Cash and
Cash Equivalents -12535.8 110.6
Positive net cash flow from any activities means a business generated more cash than it spent on
that activities and the Negative net cash flow means the business spent more than it generated on
those specific activities.
Cash Flow from Operating Activities
A healthy business should generate positive net cash flow from operating activities and should grow
the amount over time.
All the four companies are having positive net cash flow from operating and they are being
consistent except IDEA where there is comparatively higher difference between the cash flows from
operating activities from previous years which is not a very healthy sign.

17. Cash Flow from Investment Activity
The investment activities section shows the cash flows from buying and selling long-term assets,
such as equipment and property. A stable or growing business typically has negative net cash flow
from investment activities, which occurs when it buys more assets than it sells. A growing business
routinely invests in new assets to expand its capacity, replace old equipment and to keep up with
new technology.
Apart from Vodafone all the other companies have invested well in buying more valuable assets.
Verizon has comparatively has increased their investments from last year. This is a very positive sign
as they consistent in their investment.
Cash Flow from Financing Activity
The cash flow from the financing activities section shows cash flows from issuing and paying off
outside financing, such as stock and debt, and from paying dividends. A healthy business may
occasionally show positive net cash flow from financing activities as it raises money from investors
and creditors to grow its business, but a healthy business should more often show negative net cash
flow from financing activities. A negative amount suggests the business is using its cash flow from
operating activities to pay dividends and pay off its outside financing.
Except IDEA all the other companies are paying dividends to their shareholders apart from paying off
its borrowings.
a) Are you satisfied with the quality and quantum of financial disclosure levels of four companies?
Which one of them has better quality and quantum of financial disclosure than other three
companies?
Overall all the companies have provided good comprehensive annual report, yet comparing among
them we find Telstra has better the quality and quantum of financial disclosure which is very clear
from the above comparisons, adhering to majority of the accounting principles.
b) Which one of them has better fundamentals than other three companies?
Verizon is a company with highest growth rate; it has highest cash inflow and consistent growth.
Vodafone and Telstra had a stable fiscal year with moderately positive cash flow. Finally, Idea had a
bad fiscal year with overall losses and negative growth. So, in our opinion Verizon has the best
fundamentals compared to others.