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Description
Financial statement provides basic data of the financial activities of a business, person or other entity and provides an overview of a business or person’s financial condition in both short & long terms. They give an exact envision of a company’s condition & operating results in a condensed form. Primarily co. executives & investors in assessing the overall position & operating results of a company use financial statements as a management tool. Analysis & interpretation of financial statements help in determining the liquidity position, long-term solvency, financial viability and profitability of a firm. Ratio analysis show whether the company is improving or deteriorating in past years. Moreover, comparison of different aspect of all the firms can be done effectively with ratio analysis that helps the client to decide in which firm the risk is less or in which one they should invest so that maximum benefit can be earned.
