FINANCIAL STATEMENT

ANALYSIS

INSTRUCTOR: Dr. HOANG CAM TRANG

GROUP 2: LE THI KIM NGAN
THAI DUC MINH
NGUYEN THANH SON
HOANG TRONG MAI SUONG
 AGENDA

DEFINITION + FORMULA
Assets Turnover

Efficiency Inventory Turnover

ratios
Trade Payables Payment Period

Trade Receivables Collection Period

Source: Financial statements of 2020 – FPT Corporation
 Assets Turnover

The assets turnover ratio measures the value of a company's sales or revenues relative to the
value of its assets. The asset turnover ratio can be used as an indicator of the efficiency with
which a company is using its assets to generate revenue.

where:
Sales = Net revenue
Total Assets = (Beginning Assets + Ending Assets)/2 (Average asset)
Beginning Assets =Assets at the beginning of the period (1 year)
Ending Assets =Assets at the end of ​the period (1 year)
Assets Turnover (cont.)

291,964,092,178
Assets Turnover =
(16,604,172,723,297 + 11,305,646,772,891) / 2

0.0209

With 1 VND invested in assets,

0.0209 VND in revenue will be
generated
 Inventory Turnover

Inventory turnover shows many times a company has sold and

replaced inventory during a given period. A company can then divide
the days in the period by the inventory turnover formula to calculate the
days it takes to sell the inventory on hand.
Calculating inventory turnover can help businesses make better
decisions on pricing, manufacturing, marketing, and purchasing new
inventory.
Inventory Turnover (cont.)

(Times)

70,845,327,323
Inventory Turnover =
(37,367,253 + 8,129,915,288) / 2

17.3486 times

where:
COGS=Cost of goods sold
Average Inventory = (Beginning Inventory + Ending
Inventory) / 2​
 Inventory Turnover (cont.)
Inventory Average Inventory
Turnover = x 365 days
(Days) Cost of Sales (COGS)

Inventory (8,129,915,288 + 37,367,253)/2

Turnover = x 365 days
70,845,327,323

21.0392 days This number means that the company can sell its inventory in a 21-day period.
The company is attracting customers and experiencing fast sales.
 Trade Payables Payment Period
(TPPP)

The trade payables payment period (TPPP) ratio represents the time lag between a
credit purchase and making payment to the supplier. As trade payables relate to credit
purchases so credit purchases figure should be used in calculating this ratio. However as the
amount of credit purchase is usually not separately available in the income statement so in that
case total purchases could be used.
Average trade payables
TPPP = x 365 days
OR Total purchases

where:
Total purchases =Cost of goods sold + Ending Inventory - Beginning Inventory
Average trade payables = (Beginning trade payables + Ending trade payables)/ 2
 Trade Payables Payment Period (TPPP)
(Beginning Trade payables + Ending Trade payables)/ 2 x 365 days
TPPP = Cost of goods sold + Ending Inventory - Beginning Inventory

TPPP = (284,069,594,062 + 473,313,612,285) / 2

X 365 days
70,845,327,323+8,129,915,288-37,367,253

1751 days

This index shows that it takes about 1751 days

for the company to pay for goods to suppliers.
Thus, because of the company's high liquidity, the
supplier's reputation is high, leading to the
company’s high capital appropriation time.
Trade Receivables Collection Period
(TRCP)
The trade receivables collection period (TRCP) ratio represents the time lag between a
credit sale and receiving payment from the customer. As trade receivables relate to credit
sales so the credit sales figure should be used to calculate the ratio. However the amount of
credit sale is usually not separately available in the income statement so in that case total
sales could be used.

Average trade receivables

OR TRCP = x 365 days
Total sales revenue

where:
Total sales revenue = Net sales
Average receivables = (Beginning Trade receivables + Ending Trade receivables)/ 2
Trade Receivables Collection Period (TRCP)

(Beginning Trade receivables + Ending Trade receivables)/ 2

TRCP = x 365 days
Total sales revenue

(82,736,052,341 + 103,692,219,466) / 2
TRCP = x 365 days
291,964,092,178

116.5 days
It takes 116.5 days for the Company
to collect the payment of credit sales
from customers.