会计专业英语教程Financial Statements Analysis文档格式.docx

会计专业英语教程Financial Statements Analysis文档格式.docx

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教学学时

2课时

教学内容与教学过程设计

注释

FinancialStatementsAnalysis

〖理论知识〗

Topic1:

BasicAnalyticalProcedures

1.MeaningofFinancialStatementAnalysis

Financialstatementanalysisisdefinedastheprocessofidentifyingfinancialstrengthsandweaknessesofthefirmbyproperlyestablishingrelationshipbetweentheitemsofthebalancesheetandtheincomestatement.Itistheprocessofreviewingandanalyzingacompany'

sfinancialstatementstomakebettereconomicdecisions.

2.ObjectivesofFinancialStatementAnalysis

Theprimarypurposeoffinancialstatementanalysisistoevaluatetherisks,performance,financialhealth,andfutureprospectsofanorganization.

3.UsersofFinancialStatementAnalysis

（1）Creditors

Anyonewhohaslentfundstoacompanyisinterestedinitsabilitytopaybackthedebt,andsowillfocusonvariouscashflowmeasures.

（2）Investors

Bothcurrentandprospectiveinvestorsexaminefinancialstatementstolearnaboutacompany'

sabilitytocontinueissuingdividends,ortogeneratecashflow,ortocontinuegrowingatitshistoricalrate.

（3）Management

Thecompanycontrollerpreparesanongoinganalysisofthecompany'

sfinancialresults,particularlyinrelationtoanumberofoperationalmetricsthatarenotseenbyoutsideentities.

（4）Regulatoryauthorities

Ifacompanyispubliclyheld,itsfinancialstatementsareexaminedbytheSecuritiesandExchangeCommission（SEC）;

forexample,ifthecompanyfilesintheUnitedStatesthentoseeifitsstatementsconformtothevariousaccountingstandardsandtherulesoftheSEC.

4.ToolsofAnalysis

（1）TrendAnalysis:

Trendanalysisisthecomparisonoffinancialstatementinformationoveraseriesofreportingperiods.

（2）CommonSizeAnalysis:

CommonSizeanalysisisthereviewoftheproportionofaccountstoeachotherwithinasingleperiod.Common-sizebalancesheetsandincomestatementsareusedtocomparetheperformanceofdifferentcompaniesoracompany'

sprogressovertime.

（3）Ratioanalysis:

Financialratiosaremathematicalcomparisonsoffinancialstatementaccountsorcategories.Theserelationshipsbetweenthefinancialstatementaccountshelptheusersofaccountinginformationtounderstandhowwellabusinessisperformingandofareasneedingimprovement.FinancialRatiosareusedastoolstohelpussqueezeasmuchinformationaspossiblefromthefinancialstatements.Itmustbekeptinmind;

however,thatafinancialratioisonlyonenumberdividedbyanotherandonlyyieldsanumberandittakesonmeaningwhencomparedwithotherfirmsorindustryaverage.

Topic2:

RatioComputationsandInterpretations

Ratiosweredevelopedtostandardizeacompany'

sresults.Theyallowanalyststoquicklylookthroughacompany'

sfinancialstatementsandidentifytrendsandanomalies.Ratioscanbeclassifiedintermsoftheinformationtheyprovidetothereader.Thereareseveralgeneralcategoriesofratios,eachdesignedtoexamineadifferentaspectofacompany'

sperformance.Forexample,VinHuaisconsideringaninvestmentinoneofthetwofastfoodrestaurantchainsbecausehebelievesthetrendtowardeatingoutmoreoftenwillcontinue.HischoiceshavenarrowedtoFastSandwichandGiantPizza,whosebalancesheetsandincomestatementsfollow:

BalanceSheet

（inthousands）

Assets

FastSandwich

GiantPizza

Cash

$2,000

$4,500

AccountsReceivables（net）

2000

6500

Inventory

5000

Property,PlantandEquipment（net）

20000

35000

OtherAssets

4000

TotalAssets

30000

$56,000

LiabilitiesandShareholders’Equity

Accountspayable

$2,500

$3,000

NotePayable

1500

BondsPayable

10000

CommonStock（$1parvalue）

1000

3000

Paid-in-capitalinExcessofParValue,common

9000

RetainedEarnings

6000

7000

TotalLiabilitiesandShareholders’Equity

$30,000

Marketpricepershare

$30

$20

IncomeStatements

（inthousands,exceptpershare）

NetSales

$53,000

$86,000

CostofGoodsSold（restaurantopeningoperatingexpenses）

37000

61000

GrossMargin

16000

25000

Sellingexpense'

Administrativeexpenses

Interestexpenses

1400

3200

Incometaxesexpense

1800

3400

TotalOperatingExpense

14200

21600

NetIncome

EarningsPerShare

1.8

1.13

Basedontheabovecomparativebalancesheetandincomestatementsoftwocompanies,wewillexplaintheseratiosthroughoutthissection.

（1）ProfitabilityRatio:

Herearesomeofthekeyratiosthatinvestorsandcreditorsconsiderwhenjudginghowprofitableacompanyshouldbe

Ø

GrossMarginRatio

Thisshowstheaverageamountofprofitconsideringonlysalesandthecostoftheitemssold.Thistellshowmuchprofittheproductorserviceismakingwithoutoverheadconsiderations.Assuch,itindicatestheefficiencyofoperationsaswellashowproductsarepriced.Widevariationsoccurfromindustrytoindustry.Itindicatesthegrossmargingeneratedforeachdollarinnetsales.

Formula:

Grossmarginratio=Grossmargin

Netsales

Where:

Grossmargin=Netsales-Costofgoodssold

Calculation:

FastSandwich=

=30%

GiantPizza=

=29%

Interpretation:

Asyoucansee,FastSandwichhasaratioof30%,veryneartoGiantPizza,29%.Thesearehighratiointherestaurantindustry.Thismeansthatafterpaysoffhisinventorycosts,companyhasofitssalesrevenuetocoverhisoperatingcosts.

NetMarginRatio

TheNetmarginorprofitmarginratiodirectlymeasureswhatpercentageofsalesismadeupofnetincome.Inotherwords,itmeasureshowmuchprofitsareproducedatacertainlevelofsales.Thisratioalsoindirectlymeasureshowwellacompanymanagesitsexpensesrelativetoitsnetsales.Thatiswhycompaniesstrivetoachievehigherratios.Theycandothisbyeithergeneratingmorerevenueswhykeepingexpensesconstantorkeeprevenuesconstantandlowerexpenses.Likemostprofitabilityratios,thisratioisbestusedtocomparelikesizedcompaniesinthesameindustry.Thisratioisalsoeffectiveformeasuringpastperformanceofacompany.

Netmarginratio=Netincome

Netsales

=3.4%

=4.0%

Asyoucansee,FastSandwichonlyconverted3.4percentofitssalesintoprofits.Contrastthatwiththiscompany,GiantPizzahasalsoonly4%of$86,000ofnetsalesand$3400ofnetincome.Thisyearbothmayhavemadefewersalesbuttheycancutexpensesandcanbeabletoconvertmoreofthesesalesintoprofitsinfuture.

ReturnonAssets（ROA）

Thisratiomeasurestheoperatingefficacyofacompanywithoutregardstofinancialstructureandindicateshowmuchnetincomewasgeneratedfromeachdollarinaverageassetsinvested.

Returnonassets=Netincome

Averagetotalassets

Averagetotalassets=（Previouslyreportedtotalassets+currenttotalassets）

2

=6.0%

=6.1%

Asyoucansee,herealsobothcompanieshaveverysimilaramountofreturnsfromassets.

ReturnonCommonShareholders’Equity

Thisratiomeasuresthereturnaccruingtocommonshareholdersandexcludespreferredshareholders.

Returnoncommonshareholders’equity=（Netincome-preferreddividends）

Averagecommonshareholders’equity

Averagecommonequity=（previouslyreportedcommonshareholders’equity+currentcommonshareholders’equity）/2.

=11.3%

=17.9%

Asyoucansee,theprofitabilityofshareholdersinvestmentsbetweenthetwocompaniesarevarieswiththesimilaramountofinvestment.GiantPizzaperformsbetterthantheFastSandwichinthiscase.

EarningsPerShare（EPS）

Earningspershare,alsocallednetincomepershare,isamarketprospectratiothatmeasurestheamountofnetincomeearnedpershareofstockoutstanding.Higherearningspersharearealwaysbetterthanalowerratiobecausethismeansthecompanyismoreprofitableandthecompanyhasmoreprofitstodistributetoitsshareholders.Mostofthetime,earningpershareiscalculatedforyear-endfinancialstatements.Sincecompaniesoftenissuenewstockandbuybacktreasurystockthroughouttheyear,theweightedaveragecommonsharesareusedinthecalculation.Theweightedaveragecommonsharesoutstandingiscanbesimplifiedbyaddingthebeginningandendingoutstandingsharesanddividingbytwo.

Earningspershare=（Netincome-preferreddividends）

Weightedaveragenumberofsharesoutstanding

Weightedaveragenumberofsharesoutstanding=Thenumberofsharesoutstandingduringeachmonth,weightedbythenumberofmonthsthoseshareswereoutstanding.

=1.18

=1.13

Asyoucansee,FastSandwichEPSfortheyearis$1.18.Thismeansthat