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Financial Statement Analysis

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Financial Statement Analysis
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Financial Statement Analysis.
Abstract
Financial Statements are summaries of monetary data about an enterprise. Hence Financial Statement Analysis will help one to assess the Viability, Stability, Profitability and Liquidity of an enterprise. In this Assignment, an attempt, to analyze the financial performance of two companies in Textile Industry (S.Kumar Nationwide Ltd. & Gokaldas Export Ltd.) has been made. As the result of this assignment I found the performances of S.Kumar Nationwide Ltd. is better than Gokaldas Export Ltd.

Introduction
Financial statement analysis is a technique of answering various questions regarding the performance of the firm in the past, present and future. So in this assignment we have used the financial statement analysis to compare the performances of two companies S.Kumar Nationwide Ltd. & Gokaldas Export Ltd. in Textile Industry.

Methodology
This assignment is specially based on the secondary data. The required financial data were extracted from the financial statements of the selected companies. The qualitative information was collected from website www.indiainfoline.com. This assignment covers the time horizon of the Financial year 2007, 2008 & 2009.

Tools Used
Common Size BalanceSheet & Income Statement A company balance sheet, that displays all items as percentages of a common base figure is referred to Common Size BalanceSheet & IncomeStatement. • In liability side Total Liabilities is taken as a base figure and all other liabilities are calculated as percentages. • In assets side Total Assets is taken as the base figure and all other asset items are calculated as percentage. • In Common Size Income Statement, Sales Turnover is taken as the base figure to which all the incomes and expenses are calculated as percentage.

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Ratio Analysis Ratio analysis is one of the techniques of financial analysis to evaluate the financial condition and performance of a business concern. Simply,
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