Financial Statement #1 - 2007

8/4/2019 Financial Statement #1 - 2007

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FINANCIAL STATEMENT ANALYSIS

Have you ever wondered what an

analyst does with the financial

statements of a company?


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Do you believe that the financial position of a

company as revealed by its financial statements

is as clear as a blue sky without any clouds?


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A good growth of a company in the recent past implies

the same story in future and hence, it represents a

good investment opportunity!!! Will you like to grab it?


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Do not you ever wonder that a company is

earning good profits but they have no money to

pay any dividend to the shareholders??!!!!!!!!!


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And, so on


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If you are really and seriouslylooking answers of all these

Then ...


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Dr. C. P. Gupta


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Humbleobjectivesof the Course are

make the participants comfortable with the mysteries lyingbehind the financial numbers contained in financial statements.

make the participants aware of the properties of numbers

derived from financial statements.

equip the participants with necessary tools and techniques toderive meaningful information to make sound decisions thatrequire use of information from financial statements.

allow the participants to explore and fathom out the strengthsand limitations of the numbers derived from financialstatements.


9/46Our FIRST STEP is


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Towards

Understanding..


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Financial Statement Analysis

Financial Statement Analysis comprises alltechniques employed by users of financialstatements to show important relationships inthe financial statements so as to understand

business and make decisions in a better way.

is a process of evaluating the relationship

between components parts of financialstatements to obtain a better understandingof a firms financial position and performance.


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Steps in Financial Statement Analysis

First StepSelect Information relevant todecision under consideration

Second StepProcess the information to

Highlight significant relationships

Third StepInterpret and draw

Necessary inferences


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Who are the people doing Financial Statement Analysis?

Two sets of peopleINTERNAL USERS

EXTERNAL USERS


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What is the source of information for the EXTERNALPEOPLE?

External users relyon publicly-availableinformation to

perform financialanalysis

Such information iscontained in acompanys annual

report


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THREE BASIC FINANCIAL STATEMENTS

1

Annual Report contains


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FOOTNOTES/SCHEDULES TO THE

FINANCIAL STATEMENTS1

2



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FINANCIAL STATEMENTS

SUMMARY OF ACCOUNTING METHODS

1

2

3



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MANAGEMENTS DISCUSSION AND

ANALYSIS OF FINANCIAL STATEMENTS

1

2

3

4



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FOUR BASIC FINANCIAL STATEMENTS






AUDITORS REPORT

1

2

3

4

5



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AUDITORS REPORT

COMPARATIVE FINANCIAL DATA FOR A

SERIES OF YEARS

1

2

3

4

5

6



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EXAMPLE #1.


1


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EXAMPLE #1.


1


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EXAMPLE #1.


1


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EXAMPLE #2.


FINANCIAL STATEMENTS2


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EXAMPLE #3.


3


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EXAMPLE #4.



4


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EXAMPLE #5.

AUDITORS REPORT

5


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EXAMPLE #6.

COMPARATIVE FINANCIAL DATA FOR A

SERIES OF YEARS

6


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Now, we are ready with ALL NECESSARY BAGGAGE OFFINANCIAL INFORMATION.



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And, proceed for understandingfinancial statements of Nestle



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TOP LINE OF NESTL



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LINE OF NESTL FINANCIAL STATEMENT ANALYSIS


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All this is our beginning to anew story

Documents

Financial Statement #1 - 2007