Financial position

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Pruthviraj

Pruthviraj (Querist)
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22 June 2016 How to analyse the company position for the particular year based on balance sheet

Amol S Joglekar

Amol S Joglekar (Expert)
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23 June 2016 one can make use of ratio analysis. it is a powerful tool

Rupesh Jain

Rupesh Jain (Expert)
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23 June 2016 you can take comparison from last year and compare with current year with ration analysis or cash flow statement/fund flow. and to see the term loan / cc limit and stock posititon, mostly company how make to public issue they make adj in the inventories.

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CMA Ashutosh Kumar Gupta

CMA Ashutosh Kumar Gupta (Expert)
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23 June 2016 Balance Sheet reports the state of affairs of the company as on a particular date, to be read and analysed with the notes and other reports forming the part of such a Balance Sheet to give an overview of the company first.
Ratio analysis no doubt is an excellent tool for measurement but stand alone review would not provide a proper assessment and picture of the financial position unless and until a relevant and detailed analysis is done for the company, industry and competitors to form a micro and macro views.
Balance sheet just provides a true and fair view of affairs of the company as existed at a particular date and more or less a time statement. For understanding properly the financial position and status you also need to analyse P&L Account, Cash Flow Statements, Audit Report/s, Directors' Report, Quantitative Analysis, etc.