CIRI recently released its 2016 Annual Report. This document summarizes the company’s performance last year and contains information readers can use to better understand CIRI’s business and investments. Annual report financial statements can be difficult to understand. This guide explains key parts of the financial statements that begin on page 24 of CIRI’s 2016 Annual Report.
The consolidated financial statements include:
- Consolidated Balance Sheets
- Consolidated Statements of Income
- Consolidated Statements of Other Comprehensive Income
- Consolidated Statements of Changes in Shareholders’ Equity
- Consolidated Statements of Cash Flows
The consolidated financial statements are accompanied by footnotes that provide additional details about the company’s financial position, investments and earnings. An independent auditor, KPMG LLP, audited the financial statements and issued an opinion as to CIRI’s conformity with generally accepted accounting principles. Following the financial statements and footnotes is CIRI Management’s Discussion and Analysis, which provides additional information about the company’s operations and holdings.
- Assets: What the company owns and what is owed to it.
- Liabilities: What the company owes.
- Shareholders’ equity: The net worth of the company, which is equal to company assets minus company liabilities.
- Cash and cash equivalents and marketable securities: Cash in bank accounts, money market accounts, equities and bonds that can easily be converted into cash.
- Restricted cash and cash equivalents and marketable securities: Cash and marketable securities the company has set aside to pay future liabilities.
- Investments in unconsolidated affiliates: CIRI’s ownership interests in other corporations, partnerships, limited liability companies and joint ventures in which CIRI does not hold a controlling interest.
- Natural resource and energy investments: Land and resource property and energy investments, including the Fire Island Wind project.
- Liabilities: Amounts owed by CIRI from debt or costs unpaid at year-end.
CIRI’s revenues and expenses are reported by operating segment:
- Government services includes CIRI’s operations that provide services to local, state and federal government agencies.
- Oilfield and constructions services is from oilfield operations services and heavy marine hauling and construction support.
- Real estate includes commercial rental property activities and CIRI’s interests in multi-family and retail investments, as well as other real estate holdings.
- Natural resources is from oil and gas royalty revenues and 7(i) resource sharing payments received from other ANCSA corporations.
- Energy and infrastructure is CIRI’s investments in wind farms.
- Discontinued operation is the sale of CIRI Alaska Tourism, which was completed on March 11, 2016.
- Private equities is from investments in general private equity and venture capital funds that invest in a broad variety of industries, both foreign and domestic.
- Income per share of common stock divides the net income by the number of outstanding CIRI shares (627,700), to report the amount of income earned per share.
This financial statement shows the year’s activity in each of the components of shareholders’ equity including current year net income and dividends paid to shareholders.
- Net income as reported in the statements of income.
- Total dividends paid to shareholders during 2016.
This statement shows how CIRI used or received cash during the year.
- CIRI generated $14.7 million from its operations in 2016.
- CIRI invested a net $11.5 million in 2016 in a variety of operating companies, interests in partnerships and marketable securities.
- CIRI paid $22.9 million in shareholder dividends in 2016.
Asset: Something of value that is owned, including cash and items that are convertible to cash. Examples of assets include receivables (monies owed to the company), inventories (supplies), property and equipment (buildings, land, machinery, etc.).
Consolidated Balance Sheets: These reports show what a corporation and its subsidiaries own (assets) and owe (liabilities) at a certain date. They also show shareholders’ equity.
Consolidated Statements of Cash Flows: These reports show the amount of cash received and spent during a fiscal year, including:
- Cash received or spent operating a business
- Cash received or spent buying and selling assets
- Cash borrowed or paid on debt and/or paid to shareholders
Consolidated Statements of Income: These reports show the combined revenues, expenses and net income or net loss of a company.
Consolidated Statement of other Comprehensive Income: These reports show non-cash gains (or losses) not recognized in the Statements of Operations.
Expenses: The costs required to generate revenue. For example, fuel to operate construction equipment.
Fiscal year: CIRI’s fiscal year is Jan. 1 through Dec. 31.
Liability: A company’s legal debt or obligation that arises during the course of business operations.
Liquidity: Cash and current assets sufficient to satisfy a company’s liabilities and commitments as they come due.
Marketable securities: A general term for stocks, bonds or other investments that can be sold on the open market.
Net income: When total revenues exceed total expenses.
Net loss: When total expenses exceed total revenues.
Revenue: The money received from operating a business or earned from holding an asset.
Total shareholders’ equity: Total assets minus total liabilities.