Complete 3 page APA formatted essay: Octavan Construction Inc.Download file to see previous pages… Octavans reporting policies are pretty acceptable and would be beneficial to the company in the lon

Complete 3 page APA formatted essay: Octavan Construction Inc.
Download file to see previous pages…
Octavans reporting policies are pretty acceptable and would be beneficial to the company in the long term so the only suggestion to make here is that they should stick with these policies even if they are trouble some at the beginning The working capital and the debt to equity ratio has been on the decline which shows that that company is not doing so good on the assets front, the debt to equity ratio has declined and that is not a good sign because the value of the assets has been on the decline and liabilities have grown considerably which is not a good sign for any company, even creditors such as Broadmoor County Bank have started to believe that the company is in trouble and are trying to secure there loans against securities that were not deemed necessary before. Since the company has changed its depreciation method the company will now experience a total change in the depreciation expense and accumulated depreciation, which would definitely have a good effect on the assets because the current method which was employed by the company was depreciating the assets too quickly and was unrealistic for the company to use and hence it is a good move to change the depreciation method of the company and this will reap positive out come for the company. The second change that is being implemented by the company is that they have changed the method of long term billing from absolute method to the percentage-of-completed project which initially increases costs but in the long term would help the company build on steadily because there would be a better matching of the costs and revenues which would lead to a better financial report in the bigger picture.