Professional Documents
Culture Documents
Accounts
Objectives of the Session
• Users
– Performance
– Short-term liquidity
– Efficiency
– Long-term solvency
– Investors
Performance ratios
• Ratios include
– Asset turnover
• Ratios include
– Current ratio
• Possible manipulation
Efficiency ratios
• Ratios include
• Ratios include
– Gearing
– Interest cover
Gearing
• Formula: Debt/Equity
– Dividend yield
– Dividend cover
• Economic events
• Business issues
• Accounting choices
• Industry analysis
Economic events
• Interest rates
• Government policies
Business issues
• Type of business
• Quality of management
• Market conditions
• Management actions
• Asset revaluation