-> DEF LEVERAGE = D/E (Corporate Strategy => D = only financial liabilities). -> DEF: Ratio between the liabilities and the equity: -> Company increase the debt by borrowing money to sustain the investment strategy to grow, buy equipement, invest R&D … -> ⚠It is NOT reducing the equity or increasing dividends. -> OBJ: understand […]
Analysis of the Leverage Leggi tutto »
-> OBJ: evaluate the status of liquidity and its “coherence” to existing present obligations Connetc these number to the strategy. RATIOS are used two different perspectives: -> Don’t use the financial statement, is the most important component of the profitability analysis (try to explain revenue and costs and the focus is on the cash flows
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-> Matrix used by auditing & consultancy companies. Axes: -> In both we consider the average of the industry where the co9mpany is competing (available online). ORIZONTAL (Operational Efficiency) AXIS: ROA, Return On Assets (=EBIT/Tot Assets) -> revenue/ operating costs; VERTICAL (Risk) AXIS: tot liabilities/ revenue; -> PARETO APPROACH: Consider whose company that the sum
The Risk or Operational Efficiency Matrix Leggi tutto »
-> IDEA: aim of annual report is to provide a quick and useful overview of the company’s main results (performance). Summarize information about: ❓Why are they call Accounting-Based Indicators? -> Because the main data come from financial reports. ❓What are Accounting based indicators? -> They are financial indicators because they are calculated on the financial
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-> DEF: It’s a process that companies apply in order to understand the real performance of the company by comparing it with other companies in the industry. “The continuous process of measuring its own products, services, practices against the toughest competitors or those companies recognized as industry leaders”. (Camp, 1989) -> DEF: comparison of two
-> Once we gathered all the data, we can analyze the company from different perspectives. -> Whenever we have the consolidated financial statements, we have the “aggregated information”, so we need to be able to take decisions. => DEF: Segmental analysis provide further information that will allow us to take informed decisions. Ex. Segmental analysis
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-> DEF: set of statements that presents (consolidates) a parent and subsidiary company as one company. -> CONSOLIDATED FINANCIAL STATEMENT combines a set of financial documents (🔻) of separated legal entities that are controlled by a parent company (hence a group) and present them as unique entity (it’s the external accountability for a group). ⚠PROBLEM⚠:
-> DEF: process of selecting, evaluating and interpreting financial data, along with other pertinent information. -> it: -> OBJ: formulate an assessment of a company’s present and future financial condition and performance. -> Fundamental numbers: -> INPUTS: -> Financial Analysis requires: 1.1)Source Selection and Data “Triangulation” ❓ What data we have? -> FINANCIAL DISCLOSURES (traded
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General Features: -> DEF: series of production equipment used to make non reversible chemical-physical transformation of materials through a fixed technological routing. -> CHAR: -> MODELS: Example: Cement -> DEF: hydraulic binder. -> MANUFACTURE: FLOW SHEET CEMENT MANUFACTURING: ASME PROCESS DIAGRAM Physical flow: -> Raw materials are converted to Finished Products through production stages ->
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1.Segmentation: -> DEF: process through which the company divides the market into various sub-groups – with different demand profiles but internally homogenous – on the basis of which management developes specific marketing plans to best satisfy their requirements. -> OBJ: give insights to markets in order to define the best possible marketing program for every
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