Fin Stat Analysis_handnote

Fin Stat Analysis_handnote - PAGE 1 OF 8 FINANCIAL...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
PAGE 1 OF 8 FINANCIAL STATEMENT ANALYSIS FINANCIAL STATEMENTS ANNUAL REPORT OBJECTIVE OF FINANCIAL STATEMENT A. REGULATORY REQUIREMENT B. INTERNAL RECORD KEEPING AND ANALYSIS EVERY COMPANY HAVE TO PREPARE, AUDIT AND PUBLISH THEIR FINANCIAL STATEMENTS EVERY YEAR. LISTED COMPANIES HAVE TO MAKE THESE AVAILABLE IN THE MARKET, SO THAT INVESTOR CAN MAKE INVESTMENT DECISIONS BY ANALYZING THESE STATEMENTS. FINANCIAL STATEMENTS USUALLY INCLUDES DIRECTORS REPORT, REPORT FROM THE CHARTERED ACCOUNTANTS, AND OF COURSE, THE NOTES TO THE FINANCIAL FIGURES IN DETAILS AT THE BACK OF THE BOOK. USERS OF FINANCIAL STATEMENT 1. INTERNAL USERS: MANAGERS 2. EXTERNAL USERS: INVESTORS, TEACHERS, RESEARCHERS, STUDENTS, CREDIT ANALYST, CREDITORS, GOVT. TYPES OF FINANCIAL STATEMENTS A. BALANCE SHEET B. INCOME STATEMENT/ STATEMENT OF PROFIT AND LOSS C. CASH FLOW STATEMENT D. STATEMENT OF RETAINED EARNINGS E. STATEMENT OF OWNERS’ EQUITY F. VALUE ADDED STATEMENT REGULATORS OF FINANCIAL STATEMENTS (1) GAAP: Generally Accepted Accounting Principle (2) AAA: American Accounting Association (3) AMA: American Management Association (4) ICAB: Institute of Chartered Accountants, Bangladesh. (5) ICMAB: Institute of Certified Management Accountants, Bangladesh. (6) FASB: Financial Account Standard Board. (7) IAS: International Accounting Standard (8) SEC: Securities and Exchange Commission (9) GASB: Govt. Accounting Standard Board. (10) BIS: Bank for International Settlement. (11) Lloyds: For insurance and leasing companies. BALANCE SHEET
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
PAGE 2 OF 8 ASSET = LIABILITIES + OWNER’S EQUITY ASSETS [CA +FA] LIABILITIES [STL + LTL] OWNER’S EQUTIY [PAID UP + RE + RESERVE] INCOME STATEMENT GROSS SALES – VAT AND DISCOUNTS – COGS – OPERATING COST – INTEREST – TAX = NET INCOME h IT ALSO SHOWS EPS [EARNING PER SHARE]. h EBIT IS ONE OF THE IMPORTANT FIGURES THAT DETERMINES THE SUCCESS BOTH WAYS. CASH FLOW STATEMENT STATEMENT OF CASH INFLOWS AND CASH OUTFLOWS IS CALLLED CASH FLOW STATEMENT STEPS IN CASH FLOW STATEMENT: STEP ONE : CATEGORIZE THE TRANSACTIONS INTO SOURCES [INFLOWS] AND USES [OUTFLOWS]. 1.1 IF ASSET DECREASES (INCREASES), CASH SOURCE (USE) 1.2 IF LIABILITY DECREASES (INCREASES), CASH USE (SOURCE) 1.3 IF THERE IS NET INCOME (NET LOSS), CASH SOURCE (USE) 1.4 DEPRECIATION IS ALWAYS CASH SOURCE STEP TWO : ALLOCATE SOURCES AND USES INTO THREE DISTINCTIVE FINANCIAL ACTIVITIES. 2.1 CASH FLOW FROM OPERATING ACTIVITY: SHORT TERM ASSETS AND LIABILITY RELATED ACTIVITIES 2.2 CASH FLOW FROM FINANCING ACTIVITY: ACTIVITIES THROUGH WHICH COMPANY COLLECTS FUNDS 2.3 CASH FLOW FROM INVESTING ACTIVITY: ACTIVITIES THROUGH WHICH COMPANY INVESTS FUNDS STATEMENT OF RETAINED EARNINGS
Background image of page 2
PAGE 3 OF 8 RETAINED EARNINGS IS THE RESULT OF NET INCOME AND DIVIDENDS. STATEMENT OF OWNER’S EQUITY
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/01/2012 for the course BBA Fin 408 taught by Professor Lr during the Spring '12 term at East West University, Chicago.

Page1 / 8

Fin Stat Analysis_handnote - PAGE 1 OF 8 FINANCIAL...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online