Financial Statement Analysis – Article Example
Financial ment Analysis and System administration Introduction Financial ments are plain statements based on historical records, facts and figures. They are uncompromising in their objectives, nature and truthfulness. They reflect a judicious combination of recorded facts, accounting principles, concepts and conventions, personal judgement and sometimes estimates, Brown and Ronen (2013) also regarded as indices of an enterprises performance and position in the long run.
The trend from the year 2001-11 has a positive attribute, the performance is generally impressive. The borrowing and repayment figures imply that the firm or enterprise is at high performance. It is of significance to note that the returns after borrowing are quite impressive and without doubt this is a good attribute.
However, the debt or stock insuance fee has gradually decreased in minimal proportions that imply there is a diminishing attribute of the firm’s operations. Furthermore in the long run, the servicing of these debts is not a major problem to the firm since there is adequate revenue returns to service the debts.
On the contrary,during the year 2001 the firm’s operations were not impressive because the shareholders never received any dividends. This was a setback to all ordinary shareholders whose dividends never accumulates to the next financial year. In addition, the market operations as seen, by that period were never in the favor of the company’s operations and running.
It is also evident that the costs incurred in running the business seemed ambiguous which further translates out that the management did not implement policies for the good of the firm. In conclusion however, despite the shortcomings, the trend was rather impressive.
List of references
Brown. A and Ronen. J . (2013) Justifications for Audits of Financial Statements
Handbook of Key Global Financial Markets, Institutions, and Infrastructure.