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The companies conducting business in America should have full qualification. They should register with the companies registration act and work within the boundaries set by the government rules and regulations. They should present their GAAP to the American Securities and Exchange Commission. Some of the companies do not operate within the boundaries of this regulation, but they work according to their company’s requirement. A good example of the company listed in American stock exchange and which does not use IFRS is the Copa Holdings (Alvin, 1980).

Analysis

Copa Holdings

This company carries out an airline business across the world. It operates from the United States of America. It is listed in the New York stock exchange, but it does not use the IFRS like other companies. The company originates from South Africa. It transports both cargo and passengers from different places. It leads in provision of airline transport services. It provides flight services for passengers and cargo for different countries. Currently, research states that it operates in almost one hundred and twenty countries across the world. In America it operates within all the state, though this company have many branches across the world its headquarters are situated in the South Africa (Alvin, 1980).

This company does not use the IFRS like other companies listed in the American state. The company uses non- IFRS to prepare the financial statement. This assists the company a lot as it is not governed by the principals and other regulation which the companies IFRS operates under. This company prepares the statement of comparison with other companies operating in the same line. It has undergone many changes in the competition and performs the best, because without preparing the financial statement under the US GAAP it is able to identify the financial statement of the competitor. The competitors can not identify the financial stability of the company, and this enables the company grow significantly (Alvin, 1980).

Unlike other companies that use the US GAAP, it does not include all the transaction involved in the business. The calculation and measure of income involves only few transactions. The company does not include the fuel, adjusted net of the income and adjusted EPS. This assisted in comparing the performance of the company with the other companies which prepare their statement using the US GAAP. The US GAAP and the company’s GAAP differ because the company excludes the fuel CASM while the US GAAP needs inclusion  of all transactions. Application of this strategy assists the company in improving performance. The last year statement showed that this company had a total income of $ 94.4 million, while other companies got much lower income.

The company has made a lot of profit within the last three years. In the year 2010 this company managed to get a profit of $94.4 which emerged the highest in all companies providing air line services. The profit margin rose and no other company’s income could be compared the income of Copa Holdings. Those companies using the US GAAP the first had an income of $ 85.8 million in the 2011. This shows that Copa Holdings made a lot of profit which they would not, if working with US GAAP (Alvin, 1980).

Reconciliations and stake holder equity

The reconciliation of all transactions caused exclusion of special items. The reconciliation operation cost per ASM for 1Q11 amounted to $ 10.3, for 1Q10 amounted to $ 10.4 and finally for 4Q10 amounted to $ 10.7. All those amounts exclude the fuel cost because the company did not use the US GAAP. When the fuel cost was excluded the amounts reduced to $ 6.6, 7.3 and 7.3 respectively. The reconciliation of net income still excluded special item. 1Q11 had an amount totaling to 94.448, 1Q10 had $ 42,456 and 4Q10 had $ 102, 368. Those amounts included special items and without the special items the amount reduced. They had the following amounts respectively $ 81,991, 43,656 and 90,996. All those reconciliations brought up a total amount of around $ 180, 990 (Copa Holdings, 2010).

The companies operations

The Copa Holdings Company analyses the annual report on their web side. They have many operating segments which assist in development of the whole company. The operations sections are determined by the company offices which are based at New York City. There is the passenger and cargo segment, and the marketing segment. All those segments are valued on the bases of their performance, and from the place they operate from. All segments are classified as in their line of product, and some as from the region they operate from. The company operates with over four segments which are important, and ensures the facilitation of the company.

The sales and marketing department ensures the promotion of the company to many people.  It promotes the business by increasing the number of clients and this increase the profit margin. The operations segment ensures that the business gets on as required and the company does not get much loss. The operations like captains’ organizations and flight time are planned in right time to avoid inconveniences. The company’s operation sector adds more income, because by managing flight time properly the clients gets motivated, and advice other individuals to use the air line. That segment assist in the development of business, and ensures that the company has developed and increases the profit of the company.

While the segment ensures the continuity of the business and large pull of profit the company has other sources of income. The company sales shares to the stakeholders which they intern sell with a profit. This promotes the business and ensures that the business makes more profit. The shares are sold with low prices, and when the market value of share depreciates they sell to other companies. The shares market is disclosed widely by the company to the public. The operation segment and stock shares are the only business disclosed by Copa Holdings. The company provides a list of clients who cooperate and need their identity to be disclosed. This company ensures that their customers get a reward to motivate them. In the process they disclose their information in order to attract more customers. The disclosed clients promote the company because they transport their products in large quality using the air line.

 Conclusion

The Copa Holdings operates with high income rate compared to other companies which provide air services and use US GAAP. The stakeholders get a lot of money after sharing the income of the company. Companies should not use the US GAAP in order to progress effectively.

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