Orenda, Joland Cosipag Melgar, Myla Grace Silverio, Ma.

Noesa Alaban, Princess Apple

Connected to Burea of Corrections Ragojos Heritage Construction EastWest Banking Corporation Philippine Social Security
as Correction Officer 1 corporation Universal Teller/ New Account System

Financial
Management
Group 2 Tangog, Cherry Velle
Self Employed
Radoc, Edison Burce
Municipality of Montalban
FINANCIAL STATEMENTS:
STRUCTURES AND USEFULNES FOR
MANAGERIAL FINANCE

In this Topic we will be able to study and understand:

 What is a financial statement?
 Types of Financial statements
 Its Structure and Uses
FINANCIAL STATEMENTS
is a document that shows the financial activities of a business. It’s your
financial record of any and all transactions the business has done during a set
accounting period.

Balance Sheet Income Statement Cash Flow

Assets Current Revenue Operating
Non-Current

Expenses Investing
Liabilities Current

Long Term
Net Financing
Shareholder Income
Equity
The basic structure of each of these statements and their relationship
Usefulness for Managerial Finance

The income statement provides a look at a company’s financial

performance throughout a certain period, usually a fiscal quarter or
year.

The cash flow statement shows the changes in a company’s cash

position during a fiscal period.

The balance sheet shows the company’s assets, liabilities, and

stockholders’ equity at a specific point in time.
Tools of Financial Statements Analysis
Horizontal Analysis Vertical Analysis Ratio Analysis

trend ratios and common-size Current Ratio

percentages statements
working capital ratio

banker’s ratio

Quick Ratio

Acid Test Ratio

Basic Concepts of Financial Market Development and
Efficiency

What Are Financial Market?

 Financial market refers broadly to any marketplace where the
trading of securities occurs, including the stock market, bond
market, forex market, and derivatives market, among others.
Financial markets are vital to the smooth operation of capitalist
economies.
Types of Financial Markets
Stock Markets Money Markets

Over-the-Counter Derivatives Markets

Markets

Cryptocurrency
Bond Markets
Markets
Market Development
 Financial Market development aims at enhancing the capacity of the
financial system to pool domestic savings and foreign capital in
funding investment and consumption, and at enabling efficient risk-
sharing. Deep and liquid markets promote transparent and efficient
pricing of assets, attract a diverse investor base, and help transfer
risk to parties willing and able to bear them.
Market Efficiency
Market efficiency refers to a market where prices represent all relevant
financial information about an underlying asset or security.

How Market Efficiency Theory Works?

Market efficiency theory finds relevance in business and stock market
situations. It is the most effective technique for investors who spend a
large sum of money on financial instruments that provide risk-free
profits.
Forms of Market Efficiency

SEMI-WEAK
WEA STRONG
K
THE PHILIPPINE FINANCIAL SYSTEM

“STRUCTURE OF THE PHILIPPINE FINANCIAL SYSTEM”

 The Bangko Sentral Ng Pilipinas (BSP) is the central monetary
authority in charge of regulating money, banking, and credit in
the Philippines.
BANKING INSTITUTIONS
Private Banking Institutions Government Banking
Institutions
EKB/UB Commercial Banks Development Bank of the
Philippines
Thrift Banks
Savings & Mortgage Banks Land Bank of the
Private Development Banks
Philippines

Stocks Savings & Loan Association

Philippine Al-Amanah
Rural Cooperative Islamic Investment Bank
Banks Banks
Non-Bank Financial Institutions
Private non-bank Government Non-bank
Financial Institutions Financial Institutions
Investment House Investment Banks

Financing Securities Dealer Government Service

Company Insurance System
Mutual funds
Savings & Loan
Associations Lending Investor Social Security System

Pawnshops Insurance
companies PAG-IBIG
Pension funds

Credit unions
THE EVOLVING PHILIPPINE FINANCIAL SYSTEM

Bangko Sentral ng Pilipinas Insurance Commission (IC)

(BSP)

Philippine Deposit Insurance

Securities and Exchange Commission (PDIC)
Commission (SEC)
What is an Interest Rate?

Simple Interest Annual Percentage

Rate (APR)

Compound Interest VS
Annual Percentage
Yield (APY)
 Determinants of Interest Rates
Real Risk-Free Rate of Interest (Pure Rate)
Inflation Premium
Default Risk Premium
Liquidity Risk Premium
Maturity Risk Premium
Special Characteristics Premium
First 5 Companies with Substantial Assets
BDO Unibank, Inc.,
Metropolitan Bank & Trust Company (MBT)
Bank of the Philippine Islands (BPI)
Top Frontier Investment Holdings, Inc. (TFHI)
SM Investments Corporation (SM)
 Different Financial Management Terminologies
Amortization Capital Market
Assets Companies
Current Assets Institutional Investors
Fixed Assets Mutual Funds
Assets Allocation Hedge Funds
Bonds Cash Flow
Stocks Operating Cash Flow
Cash and Cash Equivalents Investing Cash Flow
Balance Sheet Financing Cash Flow
Capital Gain Cash Flow Statement
 Different Financial Management Terminologies
Compound Interest Profit Margin
Depreciation Gross Profit Margin
EBITDA Net Profit Margin
Equity Valuation
Income Statement Working Capital
Liabilities
 Current Liabilities
 Long-term Liabilities
Liquidity
Net Worth
 Financial prosperity is
impossible without constant
planning and management of
money
Sunday Adelaja

Thank You!!!