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Accounting Statement Analysis Method

2009/5/30 14:21:00 42092

Accounting statement, also known as financial statement, is the main means for enterprises or other economic entities to pmit accounting information to the outside world.

Through the preparation of accounting statements, enterprises can provide the production and operating results and financial status of enterprises to all relevant parties in written form.

If you read accounting statements without using analytical skills and simply analyzing surface numbers without the aid of analytical tools, it will be difficult to obtain useful information and sometimes even be led astray by accounting data.

In order to make the users of the report correctly reveal the relationship between various accounting data, in order to fully reflect the business performance and financial status of the enterprises, western developed countries have developed four kinds of analysis skills for financial statements in the practice of financial management for people to use flexibly.

These include: horizontal analysis, longitudinal analysis, trend percentage analysis and financial ratio analysis.

(1) the premise of horizontal analysis is to compile the balance sheet and profit and loss statement in the form of comparison between the former and the later stage. The accounting data of two consecutive years will be arranged in parallel, and the two columns of "absolute amount increase or decrease" and "percentage increase or decrease" will be added to prepare a comparative financial statement to reveal the absolute amount change and percentage change of accounting items in this period.

(2) longitudinal analysis is the ratio analysis of items in the same year.

Longitudinal analysis also has the premise that we must compile the balance sheet and profit and loss statement in the form of "percentage" or "comparability", and use the data of an important item in the accounting report as 100%, and then make the vertical arrangement of the remaining items in the accounting statements in the form of percentage of this important item, so as to reveal the relative significance of the data of each accounting item in the enterprise finance.

This form of accounting statement makes it possible to compare business and financial status between two different sized enterprises.

(3) the trend percentage analysis of accounting statements appears to be a lateral percentage analysis, but it is different from the disclosure of the percentage of increase or decrease in horizontal analysis.

The difference lies in the fact that the former does not adopt the way of the chain ratio, but concentrates the data of some important items in the accounting statements for many years, and compares the percentages of the corresponding data with the base year.

This report analysis technique is especially useful for revealing the changing trend of business activities and financial situation in a certain number of years.

(4) financial ratio analysis refers to an analysis technique that reveals the logical relationship between different items or different accounting items in the same accounting statement by getting rid of two related accounting item data and obtaining various financial ratios.

Of course, the role of calculating financial ratios is very limited. It is more important to make a comparative analysis of the calculated financial ratios, so as to help business operators, investors and other relevant personnel to correctly assess the operating results and financial situation of enterprises, adjust their investment structure and business decisions in a timely manner, and make scientific plans for the future.

A significant feature of financial ratio analysis is that it makes the economic information pmitted by accounting data of different scale units be standardized or standardized.

According to the scope and focus of the analysis, the financial ratio analysis can be broadly divided into four broad categories: liquidity analysis, financial structure analysis, asset utilization and profitability analysis, dividend, stock market value and other indicators related to stock investment income analysis.