Accounting Financial Performance Analysis Report

Added on -2020-02-19

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RUNNING HEAD: Accounting financial analysis report1Accounting financial analysis Report
Accounting financial analysis report2Executive summaryThis report has been prepared to analyze the financial performance of the Speciality fashion group limited. Various techniques have been used to analyze the financial performance of the company. In this report, horizontal, vertical and ratio analysis has been conducted. This report depict the user about various points such as how the company is performing this year, how many changes have taken into place in financial performance of the company from last year, how is the financial performance of the company and so on. Financial statement analysis is a study in which various statements are studied with the help of many tools and techniques to identify the performance of the company so that a better decision could be made by the company as well as the stakeholders to manage the decisions.
Accounting financial analysis report3ContentsIntroduction.......................................................................................................................4Analysis............................................................................................................................4Horizontal analysis.......................................................................................................4Vertical analysis............................................................................................................6Financial ratio analysis.................................................................................................7Conclusion........................................................................................................................9References.......................................................................................................................10Appendix.........................................................................................................................11
Accounting financial analysis report4Introduction:This report emphasized upon the financial information, profitability and performance of the company named by Speciality fashion group limited. This report depict the user about various points such as how the company is performing this year, how many changes have taken into place in financial performance of the company from last year, how is the financial performance of the company and so on. Financial statement analysis is a study in which various statements are studied with the help of many tools and techniques to identify the performance of the company so that a better decision could be made by the company as well as the stakeholders to manage the decisions. basically, for this analysis, profit and loss account, balance sheet and cash flow statements are taken into consideration. Analysis:Financial analysis is also known as analysis of finance, accounting analysis, financial statement analysis etc. It refers to an estimation of the stability, profitability, viability of a company or a project of a company. This study is performed by the professionals and in this study, ratio analysis, and Vertical analysis, horizontal analysis etc studies are done. This analysis is usually done by the analyst and presents it to the top level management to make a better decision about the financial stability, viability and performance of the company1. Following tools has been used in the case of Speciality fashion group limited to analyze the stability, viability and performance of the company:Horizontal analysis:This analysis is a technique of financial statement analysis. This analysis depicts about the changes in the total sum of corresponding financial statement particulars in a period. This analysis is useful for evaluating the trend situation of an organization. In this analysis, usually 2 or more periods are taken into consideration and the earliest year is used as a base year and according to that all other years are compared. Changes are usually shown into the %2. The following formula is used to analyze the horizontal position of the company:1Thaler, Richard H. The end of behavioral finance (2010): 13-23.2McNeil, Alexander J., Rüdiger Frey, and Paul Embrechts. Quantitative risk management: Concepts, techniques and tools. Princeton university press, 2015.
Accounting financial analysis report5= (Dollar changes / Amount of the item in base year) *100Horizontal analysis study has been performed in the Speciality fashion group limited to analyze the performance of the company in caparison of last year. Through the study, it hasbeen analyzed that various changes have taken place into the 2016’s performance of the company in comparison of 2015. It has been found that the revenue of the company is depicting an increment from last year and further, the cost of revenue of the company has also been enhanced3. It has been found that the increment in the revenue from last year is just 4.43% whereas the cost of revenue of the company has been enhanced by 11.89% and it has been found that the various changes have been taken place from last year in the income statement of the company.Further, balance sheet of the company has been analyzed. Through the study, it has been analyzed that various changes have taken place into the 2016’s financial performance ofthe company in comparison of 2015 in the balance sheet. It has been found that the total assets of the company is depicting an increment from last year and further, the current asset of the company has also been enhanced. It has been found that the increment in the total assets from last year is just 2.31% whereas the total liability of the company has been enhanced by 9.27% and it has been found that the various changes have been taken place from last year in the balance sheet of the company in last 3 years.Lastly, cash flow statement of the company has been analyzed. Through the study, it has been analyzed that various changes have taken place into the 2016’s financial performance of the company in comparison of 2015 and 2014 in the balance sheet. It has been found that the total cash inflow from operating activities of the company is depicting an increment from last year and further, the cash inflow from investing activities of the companyhas also been enhanced. It has been found that the increment in the cash inflow from operating activities from last year is 520% whereas the cash inflow from investing activities of the company has been enhanced by 23.08% and at the same time cash inflow from financing activities has been similar from last year. Thus it has been found that the various 3Hillier, D. J., Stephen A. Ross, Randolph W. Westerfield, Jeffrey Jaffe, and Bradford D. Jordan. Corporate finance (McGraw Hill, 2010).
Accounting financial analysis report6changes have been taken place from last year in the cash flow statement of the company in last 3 years.Vertical analysis:This analysis is a technique of financial statement analysis. This analysis depicts about the changes in the total sum of corresponding financial statement particulars according to the main base such as total revenue, total assets, liabilities etc. This analysis is useful for evaluating the trend situation of an organization. In this analysis, usually 1 or more periods are taken into consideration and the total revenue, total assets, liabilities etc are taken as a base and according to that all other particulars are compared. Changes are usually shown into the %. Vertical analysis study has been performed in the Speciality fashion group limited to analyze the performance of the company in caparison of the main base of the statement. Through the study, it has been analyzed that the cost of revenue is 44.48%, 41.52% and 40.56% in 2016, 2015 and 2014 respectively. Further, it has been analyzed that the total operating expenses is 55.39%, 58.73% and 61.05% in 2016, 2015 and 2014. Further, it has been found that the net income of the company in comparison of total revenue of the company is -0.24%, -0.51% and 1.76% in last 3 years4.Further, balance sheet of the company has been analyzed and found that various changes have taken place in the company from last year in comparison of total assets and liabilities. Through the study, it has been analyzed that the total current asset is 53.39%, 53.24% and 51.79% in 2016, 2015 and 2014 respectively. Further, it has been analyzed that the noncurrent asset is 46.61%, 47.22% and 48.66% in 2016, 2015 and 2014. Further, it has been found that the current, noncurrent liability and shareholder equity of the company in comparison of total liability and shareholder’s equity of the company is 52.04%, 46.30% and 45.98% and 22.62%, 23.61% and 24.11% and 25.34%, 30.09% and 29.91% respectively in last 3 years5. 4Pompian, Michael M. Behavioral finance and wealth management: how to build optimal portfolios that account for investor biase. (Vol. 667. John Wiley & Sons, 2011).5Moran, Mark, Doug Porter, and Jodie Curth-Bibb. Funding Indigenous organisations: improving governance performance through innovations in public finance management in

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