The concept of financial analysis

Financial analysis is based on accounting, statements and other related information.

Using a series of special analytical techniques and methods, this paper analyzes and evaluates the past and present economic management activities of enterprises and other economic organizations related to fund-raising activities, investment activities, business activities and distribution activities, such as profitability, operational ability, debt repayment ability and growth ability. It's for corporate investors.

Organizations or individuals who care about enterprises, such as creditors and business operators, are economic applied disciplines that provide accurate information or basis for understanding the past, evaluating the present situation and predicting the future decision-making of enterprises.

There are many definitions of financial analysis. Water B.Neigs, a professor at the University of Southern California in the United States, believes that the essence of financial analysis is a technology to collect all kinds of financial information related to decision-making, and analyze and explain it.

There are many methods and tools for financial analysis, and the specific application depends on the purpose of the analyst. The most commonly used is the single index and multi-index comprehensive analysis around financial indicators.

In addition, some reference values (such as budget, target, etc. ) are borrowed, and there are some analysis methods (ratio, trend, structure, factors, etc. ) analysis, and then through the intuitive and humanized format (reports, graphic reports, etc.) presented to users. ).