Alex Sakevych, Patrick Kobyletskii
2015
Aiming to detect changes in the company’s development trends in order to make more successful economic decisions, the financial statement analysis (also referred as the financial analysis of enterprise) is the process of analyzing and reviewing firm’s balance sheet (statement of financial position), income statement (profit and loss report) and other statements. It allows to estimate the company’s overall performance by calculating and comparing a complex of indicators, building the trend lines and making conclusions on the business health and sustainability. The motivation for applying the financial statement analysis to the annual report of a company is different for each group of users. Creditors are normally interested in estimating the creditworthiness of borrowers, investors want to measure the revenue their potential investments can bring, and managers are willing to have the most precise information on the financial position and performance of their companies.
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