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Limitations of financial analysis

Limitations of Financial Statement Analysis Although analysis of financial statement is essential to obtain relevant information for making several decisions and formulating corporate plans and policies, it should be...

Average Rate of Return

Average Rate of Return The rate of return on an investment that is calculated by taking the total cash inflow over the life of the...
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Profitability Ratios

Profitability Ratios Profitability ratios are a class of financial metrics that are used to assess a business’s ability to generate earnings relative to its associated...
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Internal Rate of Return

Internal Rate of Return ‘Internal Rate of Return – IRR’ Internal rate of return (IRR) is a metric used in capital budgeting to estimate the profitability of potential...

Indifference Point and how to calculate it ?

The Cost Indifference Point A cost indifference point is the point at which total cost (fixed and variable) of two alternatives under consideration is the...

CASH FLOW ANALYSIS (MEANING)

CASH FLOW STATEMENT: In 1998, the CICA revised section 1540 of the CICA Handbook, changing the “statement of changes in financial position” to “cash flow...

FINANCIAL MANAGEMENT (MEANING & SCOPE)

FINANCIAL MANAGEMENT MEANING Financial Management means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise. It...
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Turnover Ratios

Turnover Ratio Turnover Ratios draw attention to the diverse aspects of financial statement to meet the requirements of different parties interested in the business. It...

Net Present Value

What is ‘Net Present Value – NPV’ Net present value (NPV) is the difference between the present value of cash inflows and the present value...

Fund Flow Statement

CONCEPT OF “FUND’’: The term ‘fund’ has been defined and interpreted differently by different experts. Broadly the term ‘fund’ refers to all the financial resources...