A

SYNOPSIS REPORT
ON
FINANCIAL STATEMENT ANALYSIS
AT
ICICI BANK

Submitted
By
DAVVURI VARSHA
H.T.NO: ***
PROJECT SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF DEGREE
OF

MASTER OF BUSINESS ADMINISTRATION

Department of Business Administration

AURORA’S PG COLLEGE
PEERZADIGUDA
(Affiliated to Osmania University)
2023-2024
 Aurora’s PG College , PEERZADIGUDA
Department of Management

SYNOPSIS

Title of the Project : FINANCIAL STATEMENT

ANALYSIS

Student Name : DAVVURI VARSH

Hall Ticket Number : ***

Signature of the Student :

Signature of the Guide :

 INDEX
. No. CONTENTS Page No

1 TITLE OF THE PROJECT

2 STATEMENT OF THE PROBLEM

3 INTRODUCTION

4 AIMS AND OBJECTIVES

1) NATURE OF THE STUDY
2) SCOPE OF THE STUDY
3) DATA COLLECTION METHODS
4) TOOLS FOR ANALYSIS
5) CHAPTERISATION
INTRODUCTION
Financial Statements are prepared primarily for decision-making. They play a dominant role
in setting the framework of managerial decisions. But the information in the financial
statement is not an end in itself as no meaningful can be drawn from these statements alone.
The information provided in the financial statement is of immense use in making decisions
through analysis and interpretation of financial statements. The financial analysis is the
process of identifying the financial strength and weakness of the firm by properly
establishing relationship between the items of the balance sheet and P&L A/C.

There are various methods or techniques used in analyzing financial statement such as
comparative statement, trend analysis, common size statement, schedule of changes in
working capital, fund flow and cash flow analysis, cost volume profit analysis and “RATIO
ANALYSIS”.

Ratio analysis is one of the most powerful tools of financial analysis. It is a process of
establishing and interpreting various ratios that the financial statements can be analyzed more
clearly and decisions made from such analysis.
Just like a DOCTOR examines his patient by recording his body temperature, blood pressure
etc. before making his conclusion regarding the illness and before giving his treatment, a
financial analyst analysis the financial statement with various tools of analysis before
commenting upon the financial health or weaknesses of an enterprise.

A financial ratio is the relationship between two accounting figures expressed mathematically
ratio provide clues to the financial position of the concern. These are the pointers and
indicators of financial strength, soundness, position or weakness of an enterprise. One can
draw conclusions about the exact financial position of a concern with the help of ratios.
Banking sector, the world over, is known for the adoption of multidimensional strategies
from time to time with varying degrees of success. Banks are very important for the smooth
functioning of financial markets as they serve as repositories of vital financial information
and can potentially alleviate the problems created by information asymmetries. In any
organization, the two important financial statements are the Balance sheet & Profit and loss
account of the business. Balance sheet is a statement of the financial position of an enterprise
at a particular point of time. Profit and loss account shows the net profit or net loss of a
company for a specified period of time. When these statements of the last few year of any
organization are studied and analyzed, significant conclusions may be arrived regarding the
changes in the financial position, the important policies followed and trends in profit and loss
etc. Analysis and interpretation of the financial statement has now become an important
technique of credit appraisal. The investors, financial experts, management executives and
the bankers all analyze these statements.
Though the basic technique of appraisal remains the same in all the cases but
the approach and the emphasis in analysis vary. A banker interprets the financial statement so
as to evaluate the financial soundness, stability, the liquidity position and the profitability or
the earning capacity of borrowing concern. Analysis of financial statement is necessary
because it help in depicting the financial position on the basis of past and current records.
Analysis of financial statement helps in making the future decision and strategies.
Therefore, it is very necessary for every organization whether it is a financial
company or manufacturing company to make financial statement and to analysis it. After
duly recognizing the importance of financial statement analysis, this topic has been chosen as
the focus of project. It analyses the financial statement of Indian Bank from 2008 to 2012.

FINANCIAL STATEMENTS ANALYSIS:

After preparation of the financial statements(Balance Sheet and
Trading and Profit and Loss Account), one may be interested in analyzing the financial
statements with the help of different tools such as comparative statement, common size
statement, ratio analysis, trend analysis, etc. In this process a meaningful relationship is
established between two or more accounting figures for comparison.
Objectives:
 To explain the meaning, need and purpose of financial statement analysis;
 To identify the parties interested in analysis of financial statements;
 To explain the various techniques and tools of analysis of financial statements.

Financial Statement Analysis (Meaning and Purpose):

We know business is mainly concerned with the financial activities. In
order to ascertain the financial status of the business every enterprise prepares certain
statements, known as financial statements. Financial statements are mainly prepared for
decision making purposes. But the information as is provided in the financial statements is
not adequately helpful in drawing a meaningful conclusion. Thus, an effective analysis and
interpretation of financial statements is required.
Analysis means establishing a meaningful relationship between various
items of the two financial statements with each other in such a way that a conclusion is
drawn. By financial statements we mean two statements:
1. Profit and loss Account or Income Statement
2. Balance Sheet or Position Statement
These are prepared at the end of a given period of time. They are the
indicators of profitability and financial soundness of the business concern. The term financial
analysis is also known as analysis and interpretation of financial statements. It determines
financial strength and weakness of the firm. Analysis of financial statements is an attempt to
assess the efficiency and performance of the enterprise. Thus, the analysis and interpretation
of financial statements is very essential to measure the efficiency, profitability, financial
soundness and future prospects of the business units. Financial analysis serves the following
purposes:

 Measuring the profitability

 Indicating the trend of achievement
 Assessing the growth potential of the business
 Comparative position in relation to other firms
  Assess overall financial strength
 Assess solvency of the firm

Techniques and Tools of Financial Statement Analysis:

Financial statements give complete information about assets, liabilities,
equity, reserves, expenses and profit and loss of an enterprise. They are not readily
understandable to interested parties like creditors, shareholders, investors etc. Thus, various
techniques are employed for analyzing and interpreting the financial statements. Techniques
of analysis of financial statements are mainly classified into three categories:
(I) Cross-sectional analysis
It is also known as inter firm comparison. This analysis helps in analyzing
financial characteristics of another similar enterprise in that accounting period.
(II) Time series analysis
It is also called as intra-firm comparison. According to this method, the
relationship between different items of financial statement is established, comparisons
are made and results obtained. The basis of comparison may be:
 Comparison of the financial statements of different years of the same business
unit.
 Comparison of financial statement of a particular year of different business
units.
(III) Cross-sectional cum time series analysis
This analysis is intended to compare the financial characteristics of two or
more enterprises for a defined accounting period. It is possible to extend such a
comparison over the year. This approach is most effective in analyzing of financial
statements.
The analysis and interpretation of financial statements is used to determine the financial
position. A number of tools or methods or devices are used to study the relationship between
financial statements. However, the following are the important tools which are commonly
used for analyzing and interpreting financial statements: Ratio analysis, Comparative
financial statements, Common size statements, Trend analysis.

OBJECTIVES OF THE STUDY

The main objectives of this study are the following:-

 To study about ICICI Bank and its related aspects like its products & services,
history, organizational structure, subsidiary companies etc.
 To analyze the financial statement i.e. Profit & Loss account and Balance sheet of
ICICI Bank.
 To learn about Profit & Loss Account, Balance-sheet and different type of
Assets& Liabilities.
 To portray the financial position of ICICI Bank with the help of balance sheet and
profit and loss account.
 To evaluate the financial soundness, stability and liquidity of ICICI Bank.
NEED FOR THE STUDY

The analysis of financial Analysis of ICICI Bank is an attempt to assess the efficiency and
performance of the company.
To assess the efficiency and performance of the company it is necessary
1. To know earnings capacity of the company i.e., the profitability of the company.
2. To have a view of the company’s efficiency.
3. To know the comparative position in relation to previous year.
4. To have an idea about financial strength of the company.
5. To know the solvency of the company.
SCOPE OF THE STUDY

 Financial statement analysis (or financial l analysis) is the process of reviewing and
analyzing a company's financial statements to make better economic decisions.

 These statements include the income statement, balance sheet, statement of cash
flows, and a statement of retained earnings

RESEARCH METHODOLOGY

Research methodology is a way to systematically solve the research problems. It is

necessary to know not only the research methods/ techniques but also the methodology.
Research methodology is a scientific study of various steps that are adopted in research
problem.

Research:
Research can be defined as the search for knowledge, or as any systematic
investigation, with an open mind, to establish novel facts, usually using a scientific method.
The primary purpose for applied research is discovering, interpreting, and the development of
methods and systems for the advancement of human knowledge on a wide variety of
scientific matters of our world and the universe.

Research Design:
A design is used to structure the research, to show how all of the major parts of
the research project. Research design can be thought of as the structure of research- it is the
“glue” that holds all of the elements in a research project together. We often describe a design
using a concise notation that enables us to summarize a complex design structure efficiently.

Research Type:
Descriptive Research
Descriptive research is used to obtain information concerning the current status of
the phenomena to describe “what exists” with respect to variables or conditions in a situation.
Descriptive research, also known as statistical research, describes data and characteristics
about the population or phenomena being studied. Descriptive research answers the questions
who, what, where, when and how. In short descriptive research deals with everything that can
be counted and studied. The methodology involved in this design is mostly qualitative in
nature producing descriptive data.

Period of Study:
The study is related to the period from 2018-2023.

Types of Data:
While deciding about the method of data collection to be used for the study, the
researcher kept in mind for two types of data. They are:
a) Primary Data
b) Secondary Data
a) Primary data
In this study primary data is not required.
b) Secondary data
The secondary data are those financial Analyses which are collected from the company.

Research Instrument:
In this study the research, the researcher has used secondary data i.e., Annual
Report if ICICI Bank as research instrument.

Research Presentation:
After analysis of data, using various statistical techniques the findings and
suggestions are presented in the form of a report. To assist the understanding on findings and
suggestion of the study, various other details ranging from objective, need and research
methodology to the detailed presentation analysis is included in the report.
LIMITATION OF THE STUDY

However, the study is also hedged with some limitations. This study is based
on the secondary data. Naturally, the study would have the weakness of this type of data.
 Financial statement analysis tools have some inherent limitations of financial
statements. This study has also suffered from those limitations.
 The nature of financial Analysis is historical. Here, analysis and interpretation are
made on those historical data, which tells only about the past performance and the
financial weakness of the bank.
 Change in accounting procedure by a firm often makes ratio analysis misleading.
 The analysis and interpretation are based on secondary data contained in the published
annual reports of ICICI Bank for the study period.
 The study of financial performance can be only a means to know about the financial
condition of the company and cannot show a through picture of the activities of the
company.
 Further, the conclusions drawn from the study are applicable only to the ICICI Bank
and not for other banks.