Running Head: FINANCIAL ANALYSIS1Financial Analysis and Recommendation: ABC Company AnalysisNameCourseTutorDateFINANCIAL ANALYSIS2PART ONE: Financial Statements and Cash Flow AnalysisA company uses a financial system to maintain financial transactions which are used toproduce financial statements that reflect the financial health of the company for a givenaccounting period. Financial statements are essential sources of information for corporateleaders, financiers, and creditors in making decisions regarding the company. Managers requirefinancial information contained in financial statements to keep track of the company'sperformance and help develop strategies that will improve the shareholders' value throughmaximizing profit. Managers also use financial statement to develop performance trends thathelps project financial performances in the future which are important future in making decisionsthat may affect the company in the future. Investors aim at maximizing their return, and thereforefinancial statements help them assess expected investment returns and risks associated beforeinvesting. Creditors, on the other hand, need to establish a company's ability to meet its financialobligations and hence analyzes financial statements to determine the financial health of thecompany.There are three main financial tools used to report a company's financial statement whichare a statement of income, a statement of financial position or balance sheet and a s ...
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