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26 Cards in this Set
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Uses financial statement analysis to audit tax returns a checked reasonableness of reported amounts |
Regulators |
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Is the company's ability to raise cash in the short-term to meet its obligation |
Liquidity |
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Assesses both the downside and upside potential of ownership of securities. |
Equity analysis |
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Forecasting of future payoffs typically earning cash flow or both |
Prospective analysis |
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Is part of business analysis |
Financial statement analysis |
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Is the process of determining the value of a company by analyzing and interpreting key factors for the economy, the industry and the company |
Fundamental analysis |
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Business decisions include: |
Equity and debt valuation Credit risk assessment Earning predictions Audit testing Compensation negotiations |
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Is the process of evaluating and assessing the company's prospect and risk for the purpose of making sound business decisions |
Business analysis |
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Is a process of evaluating the extent to which a company's accounting reflects economic reality. |
Accounting Analysis |
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The prospect and the structure of its industry largely drive a company's profitability |
Industry analysis |
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Is the use of financial statements to analyze a company's financial position and performance and to assess future financial performance |
Financial analysis |
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Financial statements can provide managers with clues to strategic changes in operating investing and financing activities. |
Managers |
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Business analysis is performed whenever a company restructures its operations through mergers, acquisitions, divestitures and spinoffs. |
Mergers acquisitions and divestitures |
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Is the evaluation of a company's return on investment |
Profitability analysis |
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Is the evaluation of a company's ability to meet its commitments |
Risk analysis |
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Is the evaluation of a company's decision and success at establishing a competitive advantage |
Strategy analysis |
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Financial statement analysis is useful to labor unions in collective bargaining negotiations |
Labor unions |
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This requires scrutiny of a company's competitive strategy for its product mix and cost structure |
Strategy analysis |
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What are the other uses of business analysis |
Managers Mergers, acquisitions and divestitures Financial management Directors Regulators Labor Unions Customers |
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Analysis techniques are used to determine the profitability of suppliers along with estimating the suppliers profits from their mutual transactions |
Customers |
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What are the components of business analysis |
Industry analysis and strategy analysis |
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What is under a strategy analysis? |
Accounting analysis Financial analysis Prospective analysis Valuation |
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The credit worthiness or the ability of a company to owner it's credit obligation |
Credit analysis |
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Is a company's long-run viability and ability to pay long-term obligations |
Solvency |
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Also known as charting, searches for patterns in the price or volume history of a stock to predict future price movements |
Technical analysis |
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Refers o the process of converting forecasts of future payoffs into an estimate of company value |
Valuation |
