Introduction Investors and other external users of financial information will often need to measure the performance and financial health of an organization. This is done in order to evaluate the success of the business, determine any weaknesses of the business, compare current and past performance, and compare current performance with industry standards. Financially stable organizations ...
Financial ratios are a way for managers, stockholders, and creditors to determine the financial health of a company. There are five different types of financial ratios. They are: liquidity, activity, debt, profitability, and market. Liquidity, activity and debt ratios help determine the risk of the company. Market ratios help determine the risk and return of ...
Memorandum TO: EEC Chief Executive Officer (CEO) FROM: Lela Keel, EEC Financial Analyst DATE: January 10, 2011 SUBJECT: Financial Performance Analysis Introduction Financial ratios are very significant because they analyze numbers a company maintains on their financial statements. Analyzing financial ratios presents ways for internal and external viewers to establish the monetary position of ...
Financial ratio analysis is perhaps the oldest and most essential tool used to evaluate a company’s credit position and overall financial performance. Financial statements of a company generate a large number of ratios which analysts use depending on the company’s activity or purpose of analysis. Although the application of ratio analysis is widespread, it poses ...
