Common Size Analysis Essay examples

5532 Words Feb 17th, 2012 23 Pages
Common Size Statements are used to compare financial statements of different-size companies, or of the same company over different periods.

Common-size analysis - (also called vertical analysis) expresses each line item on a single year's financial statement as a percent. The base amount for the balance sheet is usually total assets (which is the same number as total liabilities plus stockholders' equity), and for the income statement it is usually net sales or revenues. By comparing two or more years of common-size statements, changes in the mixture of assets, liabilities, and equity become evident. On the income statement, changes in the mix of revenues and in the spending for different types of expenses can be identified
The ratios
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Classification of ratio:
Ratios are classified according to the need of different interested groups (e.g., share holders, lenders, investors, management, etc.). This is the most common classification of ratio. According to the need of the organization / investors, ratios can be classified differently.


Balance Sheet:
| Rs. In Cr. | Rs. In Cr |
Sources of funds | Apollo Hospitals | Fortis Healthcare |
Total Share Capital | 130.86 | 409.43 |
Equity Share Capital | 62.36 | 405.1 |
Share Application Money | 0 | 0.09 |
Preference Share Capital | 68.51 | 4.33 |
Reserves | 1,641.30 | 2,609.73 |
Revaluation Reserves | 0 | 0 |
Net Worth | 1772.16 | 3,019.25 |
Secured Loans | 549.61 | 3.42 |
Unsecured Loans | 191.4 | 445.87 |
Total Debt | 741.01 | 449.29 |
Total Liabilities | 2,513.17 | 3,468.54 |
| | |
Application of funds | | |
Gross Block | 1,444.50 | 150.74 |
LESS:Accum. Depreciation | 398.74 | 77.17 |
Net Block | 1,045.76 | 73.57 |
Capital Work in Progress | 352.4 | 5.6 |
Investments | 624.11 | 1,530.82 |
Inventories | 1150.52 | 3.23 |
Sundry Debtors | 269.64 | 54.14 |
Cash and Bank Balance | 101.68 | 38.06 |
Total Current Assets | 521.84 | 95.43 |
Loans and Advances | 571.5 | 1,867.90 |
Fixed Deposit | 39.69 | 0 |
Total CA,Loans and Advances | 1,133.03 | 1,963.33 |
Deffered Credit | 0 | 0 |
Current Liabilities |…

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