Financial statement analysis is a significant tool in

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Financial statement analysis is a significant tool in predicting the bankruptcy and failure probability of business enterprises. After being aware about probable failure, both managers and investors can take preventive measures to avoid/minimize losses. Corporate managements can effect changes in operating policy, reorganize financial structure or even go for voluntary liquidation to shorten the length of time losses [ CITATION Hel04 \l 1033 ] . The financial analysis will also focus on analyzing the current position of the assets and liabilities of the company. It will give different types of financial information to the major stakeholders of the company such as how much debt company is keeping for the current financial year or how much debt company is keeping I relation with the equity of the company. <Author2015> Page 12 of 68
HOW TO IMPROVE CURRENT FINANCIAL PERFORMANCE 1.4.2 Objectives Following are the most important objectives of the financial ratio analysis It will help the investors, management and owners to forecast the failure of the Marks and Spencer in the future. They can use this information to take preventive measures to avoid any kind of financial loss in the future. They can also analyze and restructure the organization in the future. It will help the investors to get an overview of the financial position of the company. They can get important information about the trends of the past sales, net income ,expenses, return on investment, cast flow and. This analysis is a perfect way of analyzing the past performance and indicators[ CITATION Ber04 \l 1033 ]. It will help the company to evaluate the operational and financial efficiency of the company in most effective way. The financial and operational efficiency of the company can be compared with other companies or other industrial benchmarks. Company can devise alternative strategies to prevent any harm caused from deviations caused by the financial performance. They are to provide information about the economic resources of an enterprise, the claims on those resources and the effects of transactions, events and circumstances that change its resources and claims to those resources. <Author2015> Page 13 of 68
HOW TO IMPROVE CURRENT FINANCIAL PERFORMANCE 2. Literature Review 2.1 Literature Review Financial analysis is a comprehensive process of recognizing the strengths and weaknesses in the financial structure and position of the company. It will help the Marks and Spencer and Tesco to create strong and concrete connections between different items of the financial statements of the company. Financial analysis of the Marks and Spencer and Tesco will provide complete and useful financial information to all the major stakeholders of the company. Following are the most important stakeholders interested in the financial analysis of the Shareholders Shareholders are the suppliers of the risk capital of an organization and more often than not their objective will be to improve their financial health which they have as a consequence of the ownership for shares in the organization. They normally keen on knowing how profitable and

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