Guide To Analysing Companies : The aim of this book is to provide an understanding of how to analyse and assess the performance of a company from the information provided about it.
Financial analysis is as much an art as it is a science. Combine any two figures from an annual report and a ratio is produced; the real skill is in deciding which figures to use, where to find them and how to judge the result. Before a constructive attempt can be made to analyse a com- pany, a sound grasp of financial terminology and presentation is required. Thus Part 1 of this book explains the content and intent of the main financial statements that appear in a company’s annual report: the balance sheet; the income statement or profit and loss account; and the cash flow statement.