FINANCIAL ANALYST JOB AID 1

Financial Analyst Job Aid

Name

Institution

[Author’s Note]

Financial Responsibilities
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 Analyzing organization’s past and current performance and financial data.

 Preparing organizational projections and reports based on the financial data.

 Evaluation of the organization’s depreciation and current capital expenditures.

 Setting up and appraising the organization’s profit plan.

 Performing financial audits ensuring efficiency in various technical activities.

Financial Management Decisions

Financial management is essential in making decisions critical to the organization impacting

their performance. For instance, Tesla was almost bankrupt in mid-2019, resulting in constant

major losses as, reported in the company financial reports [ CITATION Jim19 \l 1033 ].

Accounting Principles

These are guidelines used by companies to ensure comparability and consistency when

reporting their financial positions. Accounting principles make it easy for Tesla’s analysts to

analyze the financial statement (Stobierski, 2020).

Financial Statements

Financial statements provide organizational profitability information [ CITATION Car13 \l

1033 ]. Tesla’s financial analysts use this data to determine the company value and

creditworthiness, leading to informed financial decisions.

Financial Terminology

Financial statements are written records expressing financial performance of an organization.

They are used to analyze and forecast the performance of the company (Palepu el al., 2020).

Liquidity is transforming assets into cash reflecting its current market value. Liquidity

evaluates how an organization will clear its liabilities and short-term debts (Mehta & Bhavani,

2018).
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Working capital is capital used to cover the organization’s short-term operating expenses. It is

used to maintain the business afloat, to fund other big projects and for growth (Mehta &

Bhavani, 2018).

Diversification is a growth strategy involving the organization venturing into new markets,

while creating new products for the market. This assists businesses to explore new sales

avenues thus increasing their profits (Oladimeji & Udosen, 2019).

Time value of money is the idea that current cash is worth more compared to the same amount

of cash in future due to its earning capacity potential. This helps analysts make investment

decisions (Loomstein, 2018).

References

Carraher, S., & Van Auken, H. (2013). The use of financial statements for decision making by

small firms. Journal of Small Business & Entrepreneurship, 26(3), 323-336.

Collins, J. (2019). Tesla Has Failed Massively As A Public Company.

https://www.forbes.com/sites/jimcollins/2019/08/21/tesla-has-failed-massively-as-a-

public-company/?sh=4ddb93321dc2
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Loomstein, J. (2018). The Time Value Of Marketing: Why CFOs Can Become Marketing's Best

Advocate. https://www.forbes.com/sites/forbesagencycouncil/2018/11/26/the-time-value-

of-marketing-why-cfos-can-become-marketings-best-advocate/?sh=4f1cd53d4cea

Mehta, A., & Bhavani, G. (2018). Financial Statements Analysis on Tesla. Academy of

Accounting and Financial Studies Journal, 22(6), 1-9.

Oladimeji, M. S., & Udosen, I. (2019). The Effect of diversification strategy on organizational

performance. Journal of Competitiveness, 11(4), 120.

Palepu, K. G., Healy, P. M., Wright, S., Bradbury, M., & Coulton, J. (2020). Business analysis

and valuation: Using financial statements. Cengage AU.

Stobierski, T. (2020). 4 Steps to determine the financial health of your company.

https://online.hbs.edu/blog/post/how-to-determine-the-financial-health-of-a-company