# The company to provide better services to our

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the company to provide better services to our internal and external customers, and finally, the third one is that we need to look at our management and see what is the reason they are lacking on providing good numbers to our company.

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STRATEGIC PORTFOLIO Page 19. Financial Performance Interpretation The financial statement of an organization is important because it communicate about its financial information with interested parties, including investors and creditors. Four financial statements must be prepared to provide detailed information about a business entity’s financial condition at given points in time and its financial performance during periods. The four financial statements cover subjects on everything from assets, liabilities, shareholders’ equity to net income and cash flows. Those four financial statements include the balance sheets, income statement, statement of cash flow and statement of shareholders equity. In this analysis, we will review the financial statements of StilSim, and make a comparison with our biggest competitor StaffAces. An assessment of important categories of the financial statement will be offered to show insights about the companies’ strengths and weaknesses of StilSim. This analysis will demonstrate and interpreted ratios and implications for StilSim such as short-term liquidity, long- term solvency, asset management, and profitability. Short-Term Liquidity The short-term liquidity or short-term solvency is calculated to demonstrate the company’s ability to pay off its short-term debts using assets that can be easily liquidated. To calculate this ratio, we use this formula: Current Ratio = Current Assets ÷ Current Liabilities. Assets are anything owned by the business that has a financial value while liabilities are anything the business must pay for to continue operating. The current ratio gives an idea of the company's operating efficiency. A high ratio could indicate safe liquidity; however, it could mean that the company has problems getting paid on its receivable or have long inventory turnover, both symptoms that the company may not be efficiently using its current assets. (Current Ratio Interpretation, 2015)
STRATEGIC PORTFOLIO Page 20. Current Ratio and Cash Ratio The StilSim current ratio has \$8.10 in assets to pay for each \$1.00 in liabilities, and the cash ratio of StilSim has \$5.20 in cash to meet \$1.00 in liabilities. It shows a decline of the current ration compared to 2011, 2012 and 2013, but a slight increase from 2014 to 2015, whereas StaffAces current ratio shows to be \$ 2.6 in assets for each \$ 1.00 in liabilities, and the cash ratio shows to be \$ 1.00 for each \$ 1.00 in liabilities. In this case, the numbers demonstrate that StaffAces uses its short-term assets with more efficiency compared to StilSim. All that means that StilSim could use their assets more effectively, and be capable of using their resources in a positive way as well.

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• Summer '17
• StilSim

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