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Financial planning and statergy is the process of meeting your life goals through the proper management of your finances. Financial planning is the task of determining how a business will afford to achieve its strategic goals and objectives. Common avenues available in the market are: Bonds Mutual Funds Insurance Gold Real Estate
Tools and Techniques of Financial Statement Analysis: 1.Ratios Analysis .Horizontal and Vertical Analysis 2.
Year-end March Mar-2009 Mar-2010 Mar-2011 Total revenues 169.996 192.523 .764 203.
000 11-Mar 50.996 1.000 2.000 09-March 10-March 1.00.00.Horizontal & Trend Analysis 2.03.50.50.000 1.69.523 2.000 0 09-03-2011 10-03-2011 FY Year 11-03-2011 .92.764 Revenue 1.
. The ratios analysis is the most powerful tool of financial statement analysis. A ratio is a statistical yardstick by means of which relationship between two or various figures can be compared or measured.
Profitability Ratios: Gross profit ratio Net profit ratio Operating ratio Expense ratio Return on shareholders investment or net worth Return on equity capital Return on capital employed (ROCE) Ratio Dividend yield ratio Dividend payout ratio Earnings Per Share (EPS) Ratio Price earning ratio .
Liquidity ratios measure the short term solvency of financial position of a firm. Current ratio Liquid / Acid test / Quick ratio .
Activity ratios are calculated to measure the efficiency with which the resources of a firm have been employed. Inventory / Stock turnover ratio Debtors / Receivables turnover ratio Average collection period Creditors / Payable turnover ratio Working capital turnover ratio Fixed assets turnover ratio Over and under trading .
Balance sheet Income statement Statement of retained earnings: Statement of cash flows . Financial statements (or financial reports) are formal records of a business' financial activities.
government policies ◦ Staff and management morale . which are nonmonetary:◦ ◦ ◦ ◦ Nature and innovativeness of it products Technology landscape (product obsolescence) Competitors Economic conditions (recession / boom). Company’s value depends on its future profitability which depends on many factors not reflected in the balance sheet.