Financial Statement Analysis: Industry Identification Report (TB0069)

This report provides an analysis of financial statements to identify the respective industries of various companies. The analysis involves matching companies to their sectors based on their financial characteristics, including profit margins, asset composition, and expenses. The report examines companies from diverse industries such as commercial airlines, commercial banking, computer software, integrated oil and gas, IT service providers, liquor distribution and production, mobile service providers, pharmaceutical industries, retail grocery, and semiconductor manufacturing. By evaluating key financial indicators such as depreciation, receivables, inventory, research and development expenses, and profit margins, the report determines the industry each company belongs to. References to academic sources support the analysis.

Financial Statement Analyses

Table of Contents
Matching the companies with their respective industry .............................................................3
REFERENCES................................................................................................................................1

Matching the companies with their respective industry
Commercial Airline companies- As due to the economic downturn and high prices, the
profit margins of Airline companies is seen as declining and its financial statements comprises of
high depreciation assets resulted as 119.29 with an accumulated depreciation of 66.32
(Flöthmann and Hoberg, 2017). with negative profit margins equates to -5.09. Thus, the
company presented at 4th position seems to be an Commercial Airline company.
Commercial banking- The company that is having high receivables, minimal property
and an equipment of a sector, high value of the accounts payable as banks are counted as for
placing the money. There does not exist any kind of raw material and the work in progress in the
banking company as they are not the manufacturing units. Therefore, the company that is placed
at 2nd number is counted as banking company because its accounts payable and receivable are
high with nil material and WIP.
Computer software- It is seen as service industry and applies in considering higher
tangibles, lower value of inventories, low material and minimum fixed assets. Companies under
such industry is been encouraged by higher research and the development expenses (Cheng and
et.al., 2018). The company at 8th number is counted as the software company as its inventory and
material is low with high R&D.
Integrated oil and gas- The company at 5th number is considered as oil and gas company
because it has high income tax and depreciation & amortisation.
IT service provider- 3rd number is stated as IT companies as it show high equipment
with high depreciation cost.
Liquor distributor and producer- 1st is liquor based company because its depreciation
expenses are very low.
Mobile service provider- 10th shows mobile company as it is having lower or negative
profit margins because of fierce competition.
Pharmaceutical industry- As the company at 7th number is having high selling and the
general administrative expenses that is 35.77 and high R&D so it is said as pharmaceutical
company (Financial statement, 2018).
Retail grocery- The company lies at 9th number is retail company as its capital
investment is low and equities are high with high profit margins.

Semiconductor manufacturer- The firm at 6th number is counted as semiconductor
company because its research and development expenses are high that is 14.61.

REFERENCES
Books and journals
Cheng, Y. and et.al., 2018, June. Analysis on the Governance Path of Financial Fraud of Listed
Companies from the Perspective of New Media. In International Conference on Intelligent
and Interactive Systems and Applications (pp. 1064-1071). Springer, Cham.
Flöthmann, C. and Hoberg, K., 2017. Career patterns of supply chain executives: An optimal
matching analysis. Journal of Business Logistics. 38(1). pp.35-54.
Online
Financial statement. 2018. [Online]. Available through:
<http://202.129.210.58/projectfiles/internal_cust_document/IndentifyTheIndustryCase1580
296385608_redacted_1580358973.pdf>
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