Analysis of Financial
Results
Welcome to the world of financial analysis! In this presentation, we will
dive deep into the intricacies of analysing financial results to make
informed decisions.
by Farzona Almardanova
Introduction
The world of finance is filled with numbers and data that hold valuable insights. In this section, we will
explore the purpose and methods of financial analysis.
Purpose of Financial Analysis
Financial analysis serves multiple purposes, including assessing
performance, evaluating risk, and making strategic decisions. Let's
uncover how it drives informed decision-making.
Methods of Financial Analysis
Vertical Analysis
Breaks down financial statements by
percentage to analyze the relative
importance of different line items.
Horizontal Analysis
Compares financial statements over
time to identify trends and changes in
performance.
R atio Analysis
Calculates financial ratios to gain insights into liquidity, profitability, and efficiency.
Key Financial Ratios
1
Current Ratio
Measures a company's
ability to pay its short-
term obligations.
2
Return on
Investment (ROI)
Assesses the efficiency
of an investment.
3
Debt-to-Equity Ratio
Indicates the proportion
of debt used to finance a
company's assets.
Interpreting the Results
Qualitative Analysis
Examining non-financial
factors that could impact a
company's performance.
Comparative
Analysis
Benchmarking financial
results against competitors to
gain insights and identify
opportunities.
Trend Analysis
Identifying patterns in
financial data to predict future
performance.
Limitations of Financial
Analysis
While financial analysis provides valuable insights, it's essential to
consider its limitations, such as reliance on historical data and challenges
in comparing companies from different industries.
Conclusion
Financial analysis is a powerful tool that equips businesses with the knowledge to make informed
decisions. It enables stakeholders to navigate the complex world of finance with confidence.
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