The focus of financial analysis is on key figures in the financial
statements and the significant relationship that exists between
them. The analysis of financial statement is a process of
evaluating the relationship between component parts of financial
statements to obtain a better understanding of the position and
performance of a firm. The first task of the financial analyst is
to select the information relevant to the decision under
consideration from the total information contained in the financial
statements. The second step is to arrange the information in a way
to highlight significant relationships. The final step is
interpretation and drawing of inferences and conclusions. In brief,
financial analysis is the process of selection, relation and
evaluation. Keeping all this in view, the present book is devoted
to an in-depth analysis of financial statements and its use for
decision-making by various parties interested in them. The focus of
the book is on ratio analysis which is the most widely used
technique of financial statement analysis.
General
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