Riordan Manufacturing is a global leader in the manufacturing of plastics. "Its products include plastic beverage containers produced at its plant in Albany, Georgia, custom plastic parts produced at its plant in Pontiac, Michigan, and plastic fan parts produced at its facilities in Hangzhou, China" (Riordan, 2006). While its employee base is relatively small at 550, it has projected earnings of $46 million. The company is poised to maintain its good financial standing by focusing on long-term growth through research and design, customer satisfaction and employee engagement. It will also ensure that the resources needed to maintain profitability are available. Riordan Manufacturing recently expanded its operations to China. In light of this and possible future growth, the company needs to ensure a careful analysis is completed on its financial statements at regular intervals.
The data presented in Riordan's Economic Forecast indicates positive economic conditions for Riordan Manufacturing and opportunities.
According to the operating and cash budget for 2005 interest expenses were budgeted at a low $257,400 for the purpose of an increased spending in research and development expenses of $903,000 for the year with capital expenditures of $250,000 in October 2004, January 2005, and $350,000 in April 2005. Sales, marketing, and other expenses were $1,020,000 indicating Riordan's attempt to leverage relatively low interest rates into new investments to enter new markets and increase productivity.
Riordan Manufacturing has decided to include the financial reporting systems overhaul as a capital project for the fiscal year 2005. As extensive research has revealed the state-of-the-art system will resolve most of the challenges of the finance and accounting systems. The benefits of this capital investment will be a more seamless integration of the consolidated close of the General Ledger and subsequent Income Statement and Balance Sheets allowing the books to be closed in 7...