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    Ahmed Tawfick Mousa
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    The comment for each financial ratio should compare the current year's ratio results to the last year's and note whether there was a significant, slight, or no increase or decrease. The comments should also compare the ratio results to industry averages if available. There is no single correct answer for the comments, but they should explain the ratio in a simple way without complications and note any issues identified by the ratio results, such as potential short-term liquidity problems identified by an unsatisfactory current ratio.

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    The comment for each financial ratio should compare the current year's ratio results to the last year's and note whether there was a significant, slight, or no increase or decrease. The comments should also compare the ratio results to industry averages if available. There is no single correct answer for the comments, but they should explain the ratio in a simple way without complications and note any issues identified by the ratio results, such as potential short-term liquidity problems identified by an unsatisfactory current ratio.

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    10 views3 pages

    Answer

    Uploaded by

    Ahmed Tawfick Mousa
    The comment for each financial ratio should compare the current year's ratio results to the last year's and note whether there was a significant, slight, or no increase or decrease. The comments should also compare the ratio results to industry averages if available. There is no single correct answer for the comments, but they should explain the ratio in a simple way without complications and note any issues identified by the ratio results, such as potential short-term liquidity problems identified by an unsatisfactory current ratio.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Answer

    VIP Note : The comment on each Ratio should be as follows :

    You Should compare the results of current year with last year and see whether there is a (
    Significant, slight or no ) increase or decrease in the ratio …Try to find why ? Also compare
    your results with Industry average if it’s available .

    Please note that , There is no model answer for your comment but there is a methodology to do
    so as mentioned above . You may use your own word in a very simple way just to explain the
    ratio without any complication
    Example : The current ratio of year 2008 is higher than 2007 by XX% . Although there is a
    slight increase in this ratio but the current ratio still unsatisfied as the current liabilities is higher
    than current asset which may indicate that the company has a problem in short term liquidity .I
    recommend the company to increase the sales volume and accelerate the collection period of
    accounts receivable in addition to reducing some short term liabilities to avoid any serious short
    term solvency .

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