Finance Insights and Business Intelligence Introduction

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Finance Insights and Business
Intelligence

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Table of Contents
Introduction................................................................................................................................3
1..................................................................................................................................................3
2..................................................................................................................................................4
3..................................................................................................................................................4
Conclusion..................................................................................................................................5
References..................................................................................................................................6
Appendix....................................................................................................................................7

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Introduction
Financial analysis is required to be performed to evaluate the performance of the business and
in the given case the same will be done in the context of the BHP Billiton group. In this, the
ratios will be calculated and then the analysis will be made on that basis. There will be the
determination of the position and performance of the company with that. The advantages and
disadvantages in relation to ratios will also be identified and discussed.
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The ratio is the technique that will be used and in that the comparison will be made possible.
The calculations which are required to be performed are made and shown below for better
understanding.
Leverage ratios:
Particulars Formula 2018 2019
Debt to asset ratio Total debt/total assets 0.46 0.49
Asset to equity ratio Total assets/total equity 1.85 1.95
Efficiency ratios:
Particulars Formula 2018 2019
Account receivable turnover ratios Net sales/total Account receivable 13.93 12.79
Asset turnover ratios Net sales/total assets 0.39 0.44
Liquidity ratios:
Particulars Formula 2018 2019
Current
ratios
Current assets/current liabilities 2.51 1.89
Quick ratio Quick assets/current liabilities 2.24 1.58
Profitability ratios:
Particulars Formula 2018 2019
Return on assets Net profit/Total assets*100 6.91% 9.44%
Net profit
margin
Net profit/sales*100 17.96% 21.50%