Financial Statement - Chapters) (Download link at the end of this file)

Financial Statement Analysis 11e Subramanyam

(Solutions Manual All Chapters)

(Download link at the end of this file)

• / 4

Chapter 01 - Overview of Financial Statement Analysis 1-1 Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.Chapter 1

Overview of Financial Statement Analysis

REVIEW

Financial statement analysis is one important step in business analysis. Business analysis is the process of evaluating a company’s economic prospects and risks. This includes analyzing a company’s business environment, its strategies, and its financial position and performance. Business analysis is useful in a wide range of business decisions such as investing in equity or debt securities, extending credit through short or long term loans, valuing a business in an initial public offering (IPO), and evaluating restructurings including mergers, acquisitions, and divestitures. Financial statement analysis is the application of analytical tools and techniques to general-purpose financial statements and related data to derive estimates and inferences useful in business analysis. Financial statement analysis reduces one’s reliance on hunches, guesses, and intuition for business decisions. This chapter describes business analysis and the role of financial statement analysis. The chapter also introduces financial statements and explains how they reflect underlying business activities. Several tools and techniques of financial statement analysis are also introduced. Application of these tools and techniques is illustrated in a preliminary business analysis of Dell.

• / 4

Chapter 01 - Overview of Financial Statement Analysis 1-2 Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.

OUTLINE

• Introduction to Business analysis Types of Business Analysis Credit Analysis Equity Analysis Other Uses of Business Analysis Managers Mergers, Acquisitions, and Divestitures Financial Management External Auditors

Components of Business Analysis Business Environment and Strategy Analysis Financial Analysis Accounting Analysis Prospective Analysis Valuation Financial Statement Analysis and Business Analysis

▪ Financial Statements-Basis of Analysis Financial Statements Reflect Business Activities Planning Activities Financing Activities Investing Activities Operating Activities

The Annual Report Balance Sheet Income Statement Statement of Shareholders’ Equity Statement of Cash Flows Links Between Financial Statements Additional Information Management Discussion and Analysis (MD&A) Management Report Auditor Report Explanatory Notes Supplementary Information 3 / 4

Chapter 01 - Overview of Financial Statement Analysis 1-3 Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.Social Responsibility Reports Proxy Statements

▪ Financial Statement Analysis Preview Analysis Tools Areas of Preliminary Analysis Comparative Financial Statement Analysis Year-to-Year Change Analysis Index-Number Trend Analysis Common-Size Financial Statement Analysis Ratio Analysis Factors Affecting Ratios Ratio Interpretation Illustration of Ratio Analysis Cash Flow Analysis

• Specialized Analysis Tools Valuation Models Debt Valuation Equity Valuation Analysis in an Efficient Market Market Efficiency Market Efficiency Implications for Analysis

• Book Organization

• / 4