...Industry Averages and Financial Ratios Paper Manuelita Blow FIN370 Ms. Christine Gordon University of Phoenix March 13, 2015 Industry Averages and Financial Ratios Paper This paper will be discussing Target, a publicly-traded company. This paper will be Locating the SIC code for the company's industry, Finding Targets ratios for the company using the Dun & Bradstreet® Key Business Ratio link in the University Library. This paper will also be assuming that the inventory ratio is based on a traditional inventory system, but globalized markets and the supply chain make it critical to adopt lean principles to create a more efficient system. This paper will also be discussing what a change to a Just- In- Time inventory system would have if adopted by Target and Financial ratios will be calculated and the ratios will be compared with the appropriate industry. Assume According to "Just In Time Vs Traditional Inventory System." (2014), “Traditional inventory systems, seek to have enough inventory on hand so that production may continue even in the face of unexpected shortages or shipping delays. The ideal goal of JIT (Just in Time) manufacturing is to have precisely the right amount of components or materials on hand at any given moment, with as little idle inventory as possible. In a factory run perfectly according to the JIT model, every component delivered to the factory would go directly from the loading dock to the assembly line”. ("Just In Time Vs Traditional Inventory...
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...Industry Averages and Financial Ratios Paper FIN/370 RUNNING HEAD: INDUSTRY AVERAGES AND FINANCIAL RATIOS 2 ACME is looking for a bank loan to provide it with increased capital for its heater business. When deciding whether or not a company, like ACME, is financially healthy and would provide a return on the invested capital there are many tools available. By using a company’s financial statements, such as their balance sheet, we can get a small view of the heath of said business. Now by applying financial ratios and measurements towards the balance sheet, we can view the bigger picture which allows us to make a decision with far less risk in the end. First and foremost, let's discuss each ratio expressed on these financial statements as to better understand the context of how we use them to make decisions in the modern business environment. The current ratio measures the proportion of current assets to current liabilities, with this comes a rough measurement of a company’s financial health by giving us an idea of its ability to pay back its liabilities with its assets.. The acid test, or quick ratio, is a measurement designed to show a company’s ability to use cash assets to pay for short-term liabilities. Where the debt ratio measures the total debt of a company to its total assets allowing us to see what proportion of assets are financed by debt. Times interest earned...
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...com/abstract=2065057 Financial Ratio Analysis of Square Pharmaceuticals Limited Asif Ahmed ACA Trainee Accountants KPMG in Bangladesh Rahman Rahman Huq Chartered Accountants 9 Mohakhali C/A Dhaka – 1212. ACA Student The Institute of Chartered Accountants (ICAB) CA Bhaban, Kazi Nazrul Islam Avenue Dhaka, Bangladesh Contact E-mail: asif.ahmed0001@yahoo.com Electronic copy available at: http://ssrn.com/abstract=2065057 Financial Ratio Analysis of Square Pharmaceuticals Limited 2 of 24 TABLE OF CONTENTS Page No. Executive Summary 3 Chapter 1 Introduction 4 - 6 1. Introduction 4 2. Objectives of Study 4 3. Scope of Study 5 4. Methodology of Analysis 5 5. Limitations or Problem Statement 6 Chapter 2 Key Financial Highlights 7 - 11 2.1. Overview of the Organization 7 2.2. Key Financial Highlights 7 Chapter 3 Ratio Analysis 12 - 19 3.1. Liquidity Ratio Analysis; 12 3.2. Asset Management Ratio Analysis; 13 3.3. Debt Management Ratio Analysis; 15 3.4. Profitability Ratio Analysis; and 16 3.5. Market Value Ratio Analysis. 17 Conclusion 20 Recommendations 21 Bibliography 22 Annexure 23 Financial Ratio Analysis of Square Pharmaceuticals Limited 3 of 24 EXECUTIVE SUMMARY This paper is mainly an analytical outcome of financial ratio analysis of Square Pharmaceuticals Limited and pharmaceuticals industry. Eleven (11) ratios are selected to judged the various aspects of efficiency of the company, including – Current ratio, quick/acid test ratio, inventory turnover...
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...Journal of Biology, Agriculture and Healthcare ISSN 2224-3208 (Paper) ISSN 2225-093X (Online) Vol 1, No.2, 2011 www.iiste.org Financial Analysis of Selected Pharmaceutical Companies in Bangladesh Md. Tofael Hossain Majumder Department of Accounting and Information Systems, Faculty of Business Studies Comilla University, Comilla, Bangladesh. Email: tofael_cou@yahoo.com Mohammed Mizanur Rahman School of Business and Economics, Atish Dipankar University of Science and Technology Dhaka, Bangladesh. Email: mizancu@yahoo.com Abstract The Pharmaceutical industry plays a vital role in the socio-economic development of Bangladesh. But the net profit of this industry has decreased for the last few years. This study is designed to review the financial performance of this industry, to test its strengths and weaknesses. The financial performance of this industry is measured in terms of Ratio (Profitability, Liquidity, Solvency and Activity ratio) Analysis and in terms of Testing Financial Soundness by using Multivariate Discriminate Analysis (MDA) as developed by Prof. Altman. For the source of data mainly relied on Annual Reports and official records. It was observed from the study of the financial statement of the Pharmaceutical industry that the profit earning capacity, liquidity position, financial position and the performance of the most of the Pharmaceuticals are not in sound position and it was also observed that the most of the Pharmaceuticals has a lower...
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... 1.0 Introduction 1.1 Background of the report This Paper is prepared as the partial fulfillment of the course ‘Bank Management (FIN 303)’. The Paper is assigned by the course instructor, Alamgir Hossen, lecturer, IBA-JU. The main objective of this group report is to allow students to relate their textbook knowledge with the practical work field practices and provide students superiority over Financial Statement Analysis. This report on performance comparison was prepared through a comprehensive ratio analysis of the financial statements of Standard Bank Limited (SBL). The historical trends of these ratios were used to make inferences about a SBL’s financial condition, its operations and its investments attractiveness. 1.2 Objective of the Study To compare financial performance of Standard Bank Limited in FYs 2012 & 2013 as well as to compare overall performance of these two years with industry average. The basis of the study objectives are classified into two parts, Board objectives and Specific objectives. Broad Objectives * The board objective of this paper is comparative analysis of financial statements of FYs 2012 & 2013. Specific Objectives * To analyze Balance Sheets of FYs 2012 & 2013 * To analyze Income Statements of FYs 2012 & 2013 * To determine profitability ratios * To determine valuation ratios * To compare findings with industry average 1.3 Methodology of the study The research type is analytical...
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...Chapter 9 Review Questions Financial managers emphasize the goal of maximizing the market price of stock because they have a legal and ethical obligation to make decisions consistent with the financial interests of their firm’s owners. The managers who work for the company have a responsibility to act in their best interests of the stockholders, and that means increasing the value of their investment in the company. Four basic types of financial ratios are: liquidity ratio (ex. McDonald’s current ratio was 1.40 compared to the industry average 1.10. This means that McDonald’s has 40% more current assets than current liabilities), asset management ratio (ex. McDonald’s inventory turnover ratio of 128 was much stronger than the industry average of 40. In other words, McDonald’s carries 2.85 days’ worth of inventory on average), leverage ratios (ex. McDonald’s debt-to-asset ratio was 38.5%, compared to an industry average of 1.17, indicating McDonald’s has much less debt than the typical fast-food restaurant), profitability ratio (ex. McDonald’s EPS was 10.9, compared to the industry average of 8.71. It shows McDonald’s was more profitable and a better investment on average). The key questions financial planning must answer are: What specific assets must the firm obtain to achieve its goal? How much additional financing will the firm need to acquire these assets? How much financing will the firm be able to generate internally and how much it obtain from external sources? When...
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...Financial Ratios Analysis and Comparison Paper Dianne Davis MHA 612 Professor Johnson June 7, 2014 Abstract It is important for healthcare organizations to understand their present performance and weak areas in order to generate more effective operational strategies. Financial ratio analysis is an effective tool to determine hospital’s performance on several indicators such as ability to pay debt, capability to generate revenue, and sales performance etc. The objective of this paper is to describe role of different financial ratios in understanding organizational performance and in developing new strategy. The paper also presents comparative ratio analysis of local healthcare organization and industry norms. Financial Ratios Analysis and Comparison Paper Introduction Financial planning and effective management play a major role in success of healthcare business. Financial ratio analysis refers to an effective financial management tool that helps in understanding financial performance of the hospital over a period of time. Financial ratio informs about the financial trends and information on key performance indicators that helped in strategy making. Financial ratios can also utilize in comparing business performance of two or more hospitals, and also to assess effectiveness of management. Financial ratios utilized in measuring liquidity of the hospitals, profit evaluation, debt structure, management of cash flow, risk determination...
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...Compliance Paper FIN/370 June 18, 2012 Introduction Ethics and compliance play an important role in a company’s financial environment. In large corporations, such as Wal-Mart, who employ 2.1 million employees worldwide and 9029 retail units fewer than 60 different banners in 15 different countries is a prime example of how ethics and compliance practices are used effectively (Walmartstores.com) (2011). An assessment of the role ethics and compliance plays in Wal-Mart's financial environment along with procedures Wal-Mart has in place to ensure ethical behavior will be examined and discussed in this paper. Also covered in this paper: An explanation of how financial markets work in the United States and identifying the processes Wal-Mart uses to comply with SEC regulations, and an evaluation of Wal-Mart’s financial performance during the past two years using financial ratios and the trend each ratio tells about the financial health of the company. Assess the role of ethics and compliance in your organization’s financial environment The role of ethics and compliance in Wal-Mart’s financial environment is founded on the three Basic Beliefs set forth by Sam Walton (founder of Wal-Mart). The three Basic Beliefs as stated in Wal-Mart’s ethics statement are: Respect for the individual, Service to our customers and striving for excellence (Wal-Mart, n.d.). The open door communications process is another role of ethics and compliance in Wal-Mart’s financial environment...
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...Title: The analysis of Profitability and Liquidity management of Bangladesh Steel Re-Rolling Mills Limited. (The Comparative Ratio analysis of the Financial Statement between 2011 and 2012). Abstract: Liquidity and its management determines to a great extent the growth and profitability of a firm. This is because either inadequate liquidity or excess liquidity may be injurious to the smooth operations of the organization. This seeming controversy has attracted a lot of interest in the subject of liquidity management. The present study aims to reveal the Comparative analysis of liquidity and profitability of Bangladesh Steel Re-Rolling Mills Limited so that the company has to maintain this relationship while in conducting day to day operations. The results show that there is a significant impact of only liquid ratio on ROA while insignificant on ROE and EPS; the results also show that ROE is no significant effected by three ratios current ratio, quick ratio and liquid ratio while EPS is greatly affected by current ratios, quick ratios and liquid ratio. The main results of the study demonstrate that each ratio has a significant effect on the financial positions of enterprise with differing amounts and that along with the liquidity ratios in the first place. Profitability ratios also play an important role in the financial positions of enterprises. Every stakeholder has interest in the liquidity position of a company. Suppliers of goods will check the liquidity of the company...
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...technical interpreting financial statements relevant to CAT Scheme Paper 6 and Professional Scheme Paper 1.1 ratios In the exams for CAT Paper 6, Drafting Financial Statements and Professional Scheme Paper 1.1, Preparing Financial Statements candidates are often required to prepare accounting ratios and to interpret them. The main ratios that candidates will need to know are discussed in this article, and the formulae for them are given in Figure 1 on page 43. Financial statements provide important financial information for people who do not have access to the internal accounts. For example, current and potential shareholders can see how much profit a company has made, the value of its assets, and the level of its cash reserves. Although these figures are useful they do not mean a great deal by themselves. If the user is to make any real sense of the figures in the financial statements, they need to be properly analysed using accounting ratios and then compared with either the previous year’s ratios, or measured against averages for the industry. PROFITABILITY RATIOS One of the most important measures of a company’s success is its profitability. However, individual figures shown in the income statement/profit and loss account for gross profit and net profit mean very little by themselves. When these profit figures are expressed as a percentage of sales, they are more useful. This percentage can then be compared with those of previous years...
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...separate sections or departments with the accounting on a departmentalized basis” (United States Department of Labor, 2014, para. 1.). The paper will examine Walmart and other industry department stores according to financial reportings, the Dun and Bradstreet Key Business ratios report, and calculations of financial ratios. Team Calculations Solvency Ratio Solvency ratio = (After Tax Net Profit + Depreciation) / Total liabilities 2013 16,999,000+ 8,478,000/ 126,243,000= 25,477,000/ 126,243,000=20% 2012 15,699,000 + 8,106,000/121,687,000 23,805,000/121,687,000=20% Profitability Ratio Return on Sales=Net Income /Net Sales 2013 16,999,000/116,354,000=15% 2012 15,699,000/111,516,000=14% Efficiency Ratio Fixed Asset Turnover Ratio=Net Assets/Net Sales 2013 55,846,000/116,354,000=48% 2012 50,664,000/111,516,000=45% Analysis When comparing the calculated financial ratios for Walmart for 2012 and 2013 to that of the industry averages in solvency, Walmart was steady at 20% in 2012 and 2013 while the median numbers in 2012 and 2013 respectively for the industry were 64.30 and 46.20 (Dun and Bradstreet, 2014, para. 1). If this number is accurate, it is not a good indicator for how Walmart is handling cash flow. Walmart’s calculated return on sales, or profitability ratio was 14% in 2012 and 15% in 2013, but the median industry average in those respective years according to Dun and Bradstreet were 3.2 and 2.3 (Dun and Bradstreet, 2014, para. 3). There could be a fault...
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...Deliverables Company Selection – Week 1 Course Project Horizontal Analysis – Week 2 Course Project Vertical Analysis – Week 3 Course Project Final Ratio Analysis – Week 4 General Expectations for Your Final Course Project Submission – Week 7 Citation Help |Deliverables | | Course Project Company Selection Please post your chosen companies for comparison for my approval in the Week 1 Course Project Dropbox by Sunday, end of Week 1, 11:59 p.m. (MT). I will give you feedback to make sure that you're on the right track for this assignment. (5 points) Course Project Horizontal Analysis Please post the horizontal analysis for your Course Project in the Week 2 Course Project Dropbox by Sunday, end of Week 2, 11:59 p.m. (MT). (40 points) Course Project Vertical Analysis Please post the vertical Analysis for your Course Project in the Week 3 Course Project Dropbox by Sunday, end of Week 3, 11:59 p.m. (MT). (40 points) Course Project Final Ratio Analysis Please post the Ratio Analysis for your Course Project in the Week 4 Course Project Dropbox by Sunday, end of Week 4, 11:59 p.m. (MT). (40 points) Final Course Project Submission Please post the Course Project final summary assignment to the Week 7 Course Project Dropbox by Sunday, end of Week 7, 11:59 p.m. (MT). (75 points) |Category ...
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...1.1-EXECUTIVE SUMMARY: Ratio analysis is the most important tools for measuring the organization financial performance. A good analyst must use different ratios as a mechanism for evaluating the organization’s performance which is helped the investors to take a better decision of their investment. In our term paper, this report is an assigned job as a partial fulfillment of course requirement by honorable Course teacher Shaikh Masrick Hasan, Lecturer, Adjunct Faculty, ASA University Bangladesh. It is the optimum aggregated outcome of 7 pupils’ about “Ratio Analysis of Square Pharmaceuticals Limited”. The goal of this report is to measure the overall financial performance of Square Pharmaceuticals Ltd. Square Pharmaceuticals Ltd. is a renowned company in Bangladesh. It is a flagship company in the pharmaceutical industry which has reached this mountain of success by fighting many potential competitors. The main objectives are to conduct transparent business operation based on market mechanism within the legal & social frame work with aims to attain the mission. In the 1st chapter in our study paper in at first we tried to give the overall summary of our study paper, Scope or Origin of our study paper, the objectives, and problem statement of this study paper. In then we described the methodology through which we collected our required information. In 2nd chapter, we tried to give a brief idea about company profile like background information of the company, mission, vision...
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...Ethics and Compliance Paper of Microsoft Vincent Borja, Bonnie Broughton, Carrie Holland, Bonejean Jordan, Kat Kegley FIN/370 June 17, 2013 Beth Gannouni Introduction – Carrie In this paper Microsoft’s filings for the SEC and their annual reports will be analyzed. It will show the role of ethics and compliance in the financial environment of Microsoft, and describe what procedures Microsoft has in place to ensure that their actions are done with ethical behavior. It will also show what processes Microsoft used to insure they are in compliance with the regulations of the SEC. It also shows an evaluation of Microsoft’s financial performance for the past two years, the trend of each ratio, and what the financial health is for Microsoft. Role of ethics and compliance of Microsoft’s financial environment - Kat Microsoft is an organization that handles issues of technology through the production of computing products, which are useful for many organizations. The financial environment of Microsoft plays an enormous role in determining and analyzing the future status of the company. In this case, compliance committee within the organization helps in meeting set rules and objectives set by the company. Ever since the formation of Microsoft by Bill Gates, financial environment has been sustainable (Biegelman & Biegelman, 2010). This means that all people who work within the organization work hard to ensure that goals are achieved rather than working in order to be paid...
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...REPORT ON THE FINANCIAL EVALUATION: MCDONALD'S CORPORATION AND YUM! BRANDS REPORT ON THE FINANCIAL EVALUATION: McDONALD'S CORPORATION AND YUM! BRANDS TAMARA AYRAPETOVA The aim of this paper is to perform financial analysis by using financial ratios and to comment, evaluate, and understand the origins of the results by using the comparison of two companies chosen as a case study. The McDonald's Corporation is the largest fast food restaurant in the world. McDonald's Corporation statistics base it in over 119 countries and it serves more than 68 million customers daily. The company's revenues are coming not only from its primary products like hamburgers, cheeseburgers, etc., but also from rent, royalties, and fees paid by the franchisees. This report will look at the financial statements of the McDonald's Corporation over the past 3 years starting from 2010 through 2012. The author of the paper will apply financial ratios to analyze company's position and to identify patterns and trends. She will then compare the results of the analysis with one of the biggest competitors of McDonald's - Yum! Brands Inc. and the industrial averages. Yum! Brands Inc. is a US based corporation. It includes famous brands like KFC and Pizza Hut in their chain. Currently Yum! Brands are the largest competitors McDonald's has in the fast-food industry. To compare the two companies financial statements will be taken from Yahoo Finance (2013). Unauthenticated Download Date | 12/14/14 11:28 PM ...
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