COMM-1106EL Chapter Notes - Chapter 12: Quick Ratio, Gross Margin, Accounts Receivable

• School: Laurentian
• Department: Commerce and Administration
• Course: COMM-1106EL
• Professor: Leonard Valorie

Document Summary

Financial statement analysis is the process of evaluating a company"s performance based on an analysis of their financial statements (financial statement, income statement, equity statement, cash flow statement, and notes) The analysis includes calculating ratios, looking at relationships within statements, and comparing the results with historical or industry benchmarks. Analysts use financial statement analysis to help them evaluate corporate performance and the risks related to investment or lending decisions involving the company. These decisions are supported by other information, including an industry analysis, site visits, interviews with management, or other steps. Provides signals about financial health, cash flows, and operating efficiency as well as generate additional questions and point to areas that require further analysis. The following 5-step process, adapted from the chartered financial analyst institute"s financial statement analysis framework, will help you approach analysis in a logical manner: determine the purpose and context of the analysis. The annual report (md&a, and financial statements)