What is Sony's current economic condition?

Answer 1

Balance Sheet

• During the past 5 years, there is a steady increase in the total amount of asset within the company, especially in the investments. Cash and other current assets have been hit by the economic crisis of 2008 but in 2010, Sony was able to replace the lost cash and even increase it by about 200.000 million yens since before the financial crisis.
• In addition, there is a steady decline in the tangible fixed assets, showing the cost-cutting efforts made by Sony during the period of 2006-2010, creating a net decline of 300.000 million yen in the tangible current assets
• Therefore, Sony has been able to increase its assets steadily over the years

Profit and loss account

• in 2010, Sony made a loss of 40,802 million yen. This has been an improvements from 2009's 98,938 million yen loss. The decrease in the loss can be attributed mainly to the decreased cost of sales (decreasing about 600.000 million yen during 2009-2010)
• However, total receipts has not seen any dramatic change and reflect the fact that consumer spending on Sony's goods are still weak, especially when comparing it to the pre financial crisis figures(difference of 1,200,000 million yen)
• Overall, the profit/loss position of Sony is recovering according to the profit and loss account presented by the company and this may create some confident amongst the investors which can bring in more funds for Sony to increase their operations.

Cash flow statement

• Cash flow in Sony has seen many ups and downs during recent years (2006-2010) however, in 2010, the company made a very positive dramatic cash flow impact, from more than -420,000 million yen to 530,000 million yen.
• This improvement is due to an increase in overall cash inflows (probable due to less customers using credit card (need clarifications)) and a decrease in cash outflow.