FINANCIAL ANALYSIS OF THE INSURANCE INDUSTRIES

IN BANGLADESH: PRAGATI INSURANCE

COMPANY
FINANCIAL ANALYSIS OF THE INSURANCE INDUSTRIES
IN BANGLADESH: PRAGATI INSURANCE
COMPANY

Prepared for

Mr. Mohammad Abdul Momen

Associate Professor

Prepared by

M. M. Shahnewaz Kabir Shawon

Roll No.: ZR-04

BBA 15th batch

 Institute of Business Administration

January 27, 2008

Letter of Transmittal

January 27, 2008

Mr. Md. Abdul Momen

Associate Professor

Institute of Business Administration

University of Dhaka

Subject: Submission of the report of Financial Accounting II.

Dear Sir:
Here is the report on “Analysis of Financial Statements : Pragati Insurance Company” as a partial
requirement of our “Financial Accounting II” course. In this report I have analyzed the Balance Sheets
and Income Statements of the most recent 5 years of this company.. While doing so, I have learned a
lot about accounting and how these principles are used to analyze a company’s financial condition. I
have learned how to interpret the figures of annual report. This report as it has helped me to gain an
understanding of how the insurance companies work.

Thanks for your sincere co-operation throughout the duration of the course.

Sincerely,

M. M. Shahnewaz Kabir Shawon

Roll No. ZR-04

Section A

BBA 15th Batch

Table of Content

Letter of Transmittal

Executive Summary

1. Introduction
2. Objective
3. Scope
4. Source and Methods of Data Collection
5. Limitations
6. Company Background
2. Investors: The principal source of capital

2.1Financial Statement Analysis: Investor’s Perspective

3. Comparative Analysis

3.1Vertical and Horizontal Analysis

3.2Trend Percentage

4. Ratio Analysis

4.1Liquidity Ratio

4.1.1Current Ratio

4.1.2Acid Test Ratio

4.2 Equity Ratio

4.2.1 Equity (stockholder’s equity) Ratio

4.2.2 Stockholder’s Equity to Debt Ratio

4.2.3 Total Asset Turnover

4.3 Profitability Test

4.3.1 Rate of Return on Operating Assets

4.3.2 Earning per Share on Common Stock

4.3.3 Net Income to Net Revenue

4.4 Market Test

4.4.1 Earning Yield on Common Stock

4.4.2 Price Earning Ratio

4.4.3 Dividend Yield on Common Stock

4.4.4 Payout Ratio of Common Stock

5. State of Insurance Industry

6. Conclusion

7. Bibliography