The financial statement analysis demands extensive knowledge about accounting theories as well as financial concepts. Based on the reports generated by the financial statement analysis process, here are some of the key decisions an organization can make:
- Whether to Proceed or Not With the Main Operation Measuring Business Interest.
- The decision for Increasing Working Capital for Issuing Stocks and Negotiation for a Bank Loan.
- Evaluating need To Make Purchases for a Certain Materials Used in Production.
- Decisions related to requirements of requirements machinery and equipment.
- The process is also used for making decisions regarding lending and investing capital.
There is a huge demand for professionals who possess expertise in financial statement analysis as it helps organizations in making informed decisions regarding the overall business operation. Considering the immense scope of this field the students are developing a keen interest in pursuing this. So, if you are also the one who studying financial analysis then no other website can provide you better academic writing guidance than BookMyEssay. We provide expert financial statement analysis assignment help.
Important Reports of Financial Statement Analysis
As stated above, financial statements are the business documents that are prepared by the experts and presented to the senior management of the company for making better and informed decisions. Take a look at some of the imperative reports of financial statement:
Income Statement: The income statement gives us information about the net profit earned by the company during a certain financial quarter. The given formula to derive the income statement is:
Net Profit = Revenue – Expenses
The accountant begins by calculates the Gross Profit. This is derived by subtracting the total cost of production from the total income earned by the sale of goods. The direct expenses are also deducted from the income. After these deductions, the gross profit is obtained. Out of this gross profit by subtracting the different indirect expenses, net profit is come out as the remainder.
Cash Flow Statement: The to and fro flow of cash in the organization is accurately depicted in the cash flow statement. In more concise words, it is the statement that tells how much money came in and went out. The important three sections of the cash flow statement are as follow:
- The cash utilized for production and carrying out business operations.
- The income generated from the circulation of the company’s equity and other financial sources.
- The investments section represents the profitable investments of the organizations.
Balance Sheet Statement: This is possibly the most important statement of the organization that conveys information about company debts and credits. The balance sheet contains a lot of valuable information what the company owes and owns at the time. It comprises categories such as assets, liabilities, owner’s equity, cash, and at the end about profit and loss of the company. The students often seek writing services like: financial statement analysis research paper writing help from the professionals for this.