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Financial Statement Analysis

Shafi Ullah Khan Niazi

Recommended Book

Financial Statement Analysis By Charles H Gibson (7th Edition)

FSA What is it about?

FSA consists of reformulating reported financial statements, analysis & adjustments of measurement errors, and financial ratio analysis of these two

Scope

Financial Position (Balance Sheet) Profitability Position (Statement of Earnings) Reconciliation of Owners Equity Accounts (Statement of Owners Equity) Cash Inflow & Outflow (Statement of Cash Flow)

Objectives

STAKEHOLDERS INTEREST IN:

Providing foundation for evaluating and pricing credit risk & Doing Fundamental Company Valuation

Users of FSA

Creditors: Lenders interested in stability to pay back Investors: Interested in ability to continue issuing dividends Management: Analysis of results for operational purposes Regulatory Authorities: Security & Exchange Commissions (SECP in Pak) to look into conformity to various accounting standards, if a company is publicly held

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