B Com Exam > B Com Notes > Financial Analysis and Reporting > Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting
Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting | Financial Analysis and Reporting - B Com PDF Download
Comparative financial statements
Comparative financial statements are the complete set of financial statements that an entity issues, revealing information for more than one accounting period. The financial statements that may be included in this package are:
- The income statement (showing results for multiple periods)
- The balance sheet (showing the financial position of the entity as of more than one balance sheet date)
- The statement of cash flows (showing the cash flows for more than one period)
Another variation on the comparative concept is to report information for each of the 12 preceding months on a rolling basis. Comparative financial statements are quite useful for the following reasons:
- Provides a comparison of an entity's financial performance over multiple periods, so that you can determine trends. The statements may also reveal unusual spikes in the reported information that can indicate the presence of accounting errors.
- Provides a comparison of expenses to revenues and the proportions of various items on the balance sheet over multiple periods. This information can be useful for cost management purposes.
- May be useful for predicting future performance, though you should rely more on operational indicators and leading indicators than on historical performance for this type of analysis.
It is customary to issue comparative financial statements with additional columns containing the variance between periods, as well as the percentage change between periods.
The Securities and Exchange Commission requires that a publicly held company use comparative financial statements when reporting to the public on the Form 10-K and Form 10-Q.
Comparative Financial Statements Example
The following is an example of a balance sheet that is presented on a comparative basis.
ABC International Balance Sheet
| as of 12/31/20X3 |
as of 12/31/20X2 |
as of 12/31/20X1 |
|
|
Current assets |
|
|
|
|
Cash |
$1,200 |
$900 |
$750 |
|
Accounts receivable |
4,800 |
3,600 |
3,000 |
|
Inventory |
3,600 |
2,700 |
2,300 |
|
Total current assets |
$9,600 |
$7,200 |
$6,050 |
|
Total fixed assets |
6,200 |
5,500 |
5,000 |
|
Total Assets |
$15,800 |
$12,700 |
$11,050 |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
Accounts payable |
$2,400 |
$1,800 |
$1,500 |
|
Accrued expenses |
480 |
360 |
300 |
|
Short-term debt |
800 |
600 |
400 |
|
Total current liabilities |
$3,680 |
$2,760 |
$2,200 |
|
Long-term debt |
9,020 |
7,740 |
7,350 |
|
Total liabilities |
12,700 |
10,500 |
9,550 |
|
Shareholders’ equity |
3,100 |
2,200 |
1,500 |
|
Total liabilities and equity |
$15,800 |
$12,700 |
$11,050 |
The document Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting | Financial Analysis and Reporting - B Com is a part of the B Com Course Financial Analysis and Reporting.
All you need of B Com at this link: B Com
|
2 videos|51 docs|19 tests
|
FAQs on Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting - Financial Analysis and Reporting - B Com
| 1. What are the different techniques used in financial statement analysis? |  |
Ans. Financial statement analysis involves various techniques, including ratio analysis, trend analysis, vertical analysis, horizontal analysis, and cash flow analysis. These techniques help in evaluating the financial performance, liquidity, solvency, and profitability of a company.
| 2. How does ratio analysis help in financial statement analysis? | |
Ans. Ratio analysis is a technique used to evaluate the financial performance of a company by analyzing its financial ratios. These ratios, such as liquidity ratios, profitability ratios, and solvency ratios, provide insights into the company's financial health, efficiency, and ability to meet its financial obligations. Ratio analysis helps in comparing the company's performance with industry benchmarks and identifying areas of strength and weakness.
| 3. What is trend analysis in financial statement analysis? | |
Ans. Trend analysis is a technique used to analyze the financial statements over a period of time to identify patterns, trends, and changes in financial performance. It involves comparing the financial data of a company over multiple periods and calculating the percentage change. Trend analysis helps in understanding the company's growth rate, stability, and direction of financial performance.
| 4. How does vertical analysis assist in financial statement analysis? | |
Ans. Vertical analysis is a technique used to analyze the financial statements by expressing each line item as a percentage of a base figure. It helps in understanding the composition and relative importance of various components of the financial statements. Vertical analysis enables the comparison of different companies and industries by focusing on the proportion of each line item in relation to the base figure.
| 5. What is the importance of cash flow analysis in financial statement analysis? | |
Ans. Cash flow analysis is crucial in financial statement analysis as it provides insights into the company's cash inflows and outflows over a specific period. It helps in assessing the company's ability to generate cash, meet its financial obligations, and fund its operations. Cash flow analysis also helps in evaluating the company's cash management, liquidity, and investment decisions.
Related Exams
About this Document
|
4.98/5 Rating |
|
Nov 22, 2024 Last updated |
Document Description: Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting for B Com 2024 is part of Financial Analysis and Reporting preparation.
The notes and questions for Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting have been prepared according to the B Com exam syllabus. Information about Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting covers topics
like and Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting Example, for B Com 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises and tests below for Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting.
Introduction of Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting in English is available as part of our Financial Analysis and Reporting
for B Com & Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting in Hindi for Financial Analysis and Reporting course.
Download more important topics related with notes, lectures and mock test series for B Com
Exam by signing up for free. B Com: Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting | Financial Analysis and Reporting - B Com
Description
Full syllabus notes, lecture & questions for Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting | Financial Analysis and Reporting - B Com - B Com | Plus excerises question with solution to help you revise complete syllabus for Financial Analysis and Reporting | Best notes, free PDF download
Information about Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting
In this doc you can find the meaning of Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting defined & explained in the simplest way possible. Besides explaining types of
Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting theory, EduRev gives you an ample number of questions to practice Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting tests, examples and also practice B Com
tests
|
Explore Courses for B Com exam
|
|
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
Related Searches
Financial Analysis and Reporting | Financial Analysis and Reporting - B Com
,video lectures
,Objective type Questions
,Financial Analysis and Reporting | Financial Analysis and Reporting - B Com
,Important questions
,Comparative Statement - Techniques of Financial Statement Analysis
,shortcuts and tricks
,Semester Notes
,ppt
,study material
,Comparative Statement - Techniques of Financial Statement Analysis
,Summary
,Comparative Statement - Techniques of Financial Statement Analysis
,Free
,mock tests for examination
,past year papers
,Exam
,Financial Analysis and Reporting | Financial Analysis and Reporting - B Com
,Viva Questions
,Previous Year Questions with Solutions
,Extra Questions
,practice quizzes
,MCQs
,Sample Paper
;
Additional Information about Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting for B Com Preparation
Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting Free PDF Download
The Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting is an invaluable resource that delves deep into the core of the B Com exam.
These study notes are curated by experts and cover all the essential topics and concepts, making your preparation more efficient and effective.
With the help of these notes, you can grasp complex subjects quickly, revise important points easily,
and reinforce your understanding of key concepts. The study notes are presented in a concise and easy-to-understand manner,
allowing you to optimize your learning process. Whether you're looking for best-recommended books, sample papers, study material,
or toppers' notes, this PDF has got you covered. Download the Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting now and kickstart your journey towards success in the B Com exam.
Importance of Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting
The importance of Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting cannot be overstated, especially for B Com aspirants.
This document holds the key to success in the B Com exam.
It offers a detailed understanding of the concept, providing invaluable insights into the topic.
By knowing the concepts well in advance, students can plan their preparation effectively.
Utilize this indispensable guide for a well-rounded preparation and achieve your desired results.
Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting Notes
Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting Notes offer in-depth insights into the specific topic to help you master it with ease.
This comprehensive document covers all aspects related to Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting.
It includes detailed information about the exam syllabus, recommended books, and study materials for a well-rounded preparation.
Practice papers and question papers enable you to assess your progress effectively.
Additionally, the paper analysis provides valuable tips for tackling the exam strategically.
Access to Toppers' notes gives you an edge in understanding complex concepts.
Whether you're a beginner or aiming for advanced proficiency, Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting Notes on EduRev are your ultimate resource for success.
Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting B Com Questions
The "Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting B Com Questions" guide is a valuable resource for all aspiring students preparing for the
B Com exam. It focuses on providing a wide range of practice questions to help students gauge
their understanding of the exam topics. These questions cover the entire syllabus, ensuring comprehensive preparation.
The guide includes previous years' question papers for students to familiarize themselves with the exam's format and difficulty level.
Additionally, it offers subject-specific question banks, allowing students to focus on weak areas and improve their performance.
Study Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting on the App
Students of B Com can study Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting alongwith tests & analysis from the EduRev app,
which will help them while preparing for their exam. Apart from the Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting,
students can also utilize the EduRev App for other study materials such as previous year question papers, syllabus, important questions, etc.
The EduRev App will make your learning easier as you can access it from anywhere you want.
The content of Comparative Statement - Techniques of Financial Statement Analysis, Financial Analysis and Reporting is prepared as per the latest B Com syllabus.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup