How to use DuPont financial analysis system to analyze the reasons for the increase and decrease of return on net assets?

DuPont analysis system formula: return on shareholders' equity F = net sales rate A× total assets turnover rate B× equity multiplier C. Therefore, the factors that determine the return on shareholders' equity are the three aspects in the above formula. After such decomposition, we can analyze the influence of the increase and decrease of various factors on the change of shareholders' return on net assets. The specific analysis method is serial substitution method.

The use of serial substitution method is as follows:

Let F0=A0×B0×C0 (1).

Substitute the coefficient A 1×B0×C0 (2).

Replace the b factor A 1×B 1×C0 (3).

Substitute c factor a/kloc-0 /× b/kloc-0 /× c1(4).

Then (2)-( 1) is the influence of the change of factor a on the index f.

(3)-(2) is the influence of the change of factor B on the index F. ..

(4)-(3) is the influence of the change of factor C on the index F. ..

Extended data:

From the perspective of enterprise performance evaluation, DuPont analysis method only contains financial information, which can not fully reflect the strength of enterprises and has great limitations. In practical application, it should be noted that it must be analyzed in combination with other information of the enterprise. Mainly manifested in:

1. Paying too much attention to short-term financial results may encourage the short-term behavior of the company's management and ignore the long-term value creation of the company.

2. Financial indicators reflect the past business performance of enterprises and measure whether enterprises in the industrial age can meet the requirements. However, in the new information age, customers, suppliers, employees, technological innovation and other factors have more and more influence on the business performance of enterprises, and DuPont analysis can do nothing in these aspects.

3. In the market environment, the intangible knowledge assets of enterprises are very important to improve the long-term competitiveness of enterprises, but DuPont analysis method can not solve the valuation problem of intangible assets.

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