Financial Analysis

Financial analysis is the process of evaluating a company's performance, financial health, and future prospects by using its financial statements and other relevant data. Practitioners employ a range of techniques, such as ratio analysis (to assess profitability, liquidity, and solvency), trend analysis, and comparative analysis against industry benchmarks. The ultimate goal is to interpret this financial information to make more informed economic decisions, whether for internal strategic planning by management or for external investment and credit decisions by investors and lenders.

1. Introduction to Financial Analysis
   1. Definition and Scope of Financial Analysis
      1. What is Financial Analysis
      2. Role in Business Decision-Making
      3. Relationship to Accounting and Finance
   2. Objectives of Financial Analysis
      1. Assessing Financial Performance
      2. Evaluating Financial Position
      3. Measuring Operational Efficiency
      4. Determining Investment Attractiveness
      5. Identifying Financial Risks
      6. Supporting Strategic Planning
   3. Key Questions in Financial Analysis
      1. Profitability Assessment
      2. Liquidity Evaluation
      3. Solvency Analysis
      4. Operational Efficiency
      5. Growth Prospects
      6. Risk Assessment
   4. Users of Financial Analysis
      1. Internal Users
         1. Management Teams
         2. Board of Directors
         3. Employees and Labor Unions
      2. External Users
         1. Equity Investors
         2. Debt Investors and Creditors
         3. Suppliers and Customers
         4. Regulatory Bodies
         5. Credit Rating Agencies
         6. Investment Analysts
         7. Competitors
   5. The Financial Analysis Process
      1. Defining Analysis Objectives
      2. Data Collection and Verification
      3. Selection of Analytical Methods
      4. Computation and Analysis
      5. Interpretation of Results
      6. Report Preparation and Communication
   6. Limitations of Financial Analysis
      1. Historical Nature of Data
      2. Accounting Policy Variations
      3. Impact of Inflation
      4. Qualitative Factors
      5. Industry and Economic Context
   7. Professional Standards and Ethics
      1. Integrity and Objectivity
      2. Professional Competence
      3. Confidentiality Requirements
      4. Conflict of Interest Management
      5. Regulatory Compliance