Question -
The following questions need to be answered in regards to JCPenney acquiring Kohls. Must use current references and format in answer.
From the Due Diligent Checklist:
Revenue
1. Summarize sales by customer for the current and past year.
2. Summarize sales by product for the current and past year.
3. Determine the seasonality of revenue, if applicable for the company.
Complexity
1. Evaluate the number and variability of revenue sources, if possible and practical.
2. Review the volatility of the effective tax rate.
3. If there is a tax deferral, investigate the differences between tax and book income.
Marketing
1. What types of advertising and promotion are used?
2. Does the company have a website? Who owns the site and how is it hosted?
3. Does the company use e-mail for marketing notifications to customers?
4. What are the proportions of sales by distribution channel?
5. How many customers can the company potentially market its products to? What would be the volume by customer?
6. What is the company's market share? What is the trend?
7. Are there new markets in which the products can be sold?
Other
1. If possible, discuss revenue recognition policies. (person 2)
2. Determine risk management strategies and insurance coverage.
3. Evaluate the company's benefit plan to determine its cost, as well as the amount of employee participation.
4. Look through the footnotes and obtain a list of significant accounting policies.