Theme: Introduction into course «Financial economic analysis of foreign economic activities of enterprise» Plan: Plan: Concepts and objectives of financial economic analysis of foreign economic activities of enterprise. Concepts and objectives of financial economic analysis of foreign economic activities of enterprise.

Financial analysis (also referred to as financial statement analysis or accounting analysis ) refers to an assessment of the viability, stability and profitability of a business, sub-business or project. businessprojectbusinessproject

financial analysis can be an important tool for small business owners and managers to measure their progress toward reaching company goals, as well as toward competing with larger companies within an industry. financial analysis can be an important tool for small business owners and managers to measure their progress toward reaching company goals, as well as toward competing with larger companies within an industry. It is also important for small business owners to understand and use financial analysis because it provides one of the main measures of a company's success from the perspective of bankers, investors, and outside analysts. It is also important for small business owners to understand and use financial analysis because it provides one of the main measures of a company's success from the perspective of bankers, investors, and outside analysts.

The process of evaluating businesses, projects, budgets and other finance- related entities to determine their suitability for investment. Typically, financial analysis is used to analyze whether an entity is stable, solvent, liquid, or profitable enough to be invested in.

One of the most common ways of analyzing financial data is to calculate ratios from the data to compare against those of other companies or against the company's own historical performance. For example, return on assets is a common ratio used to determine how efficient a company is at using its assets and as a measure of profitability. This ratio could be calculated for several similar companies and compared as part of a larger analysis. One of the most common ways of analyzing financial data is to calculate ratios from the data to compare against those of other companies or against the company's own historical performance. For example, return on assets is a common ratio used to determine how efficient a company is at using its assets and as a measure of profitability. This ratio could be calculated for several similar companies and compared as part of a larger analysis.

Goals Financial analysts often assess the following elements of a firm: Financial analysts often assess the following elements of a firm: 1. Profitability - its ability to earn income and sustain growth in both the short- and long-term. A company's degree of profitability is usually based on the income statement, which reports on the company's results of operations; 1. Profitability - its ability to earn income and sustain growth in both the short- and long-term. A company's degree of profitability is usually based on the income statement, which reports on the company's results of operations;income statementincome statement 2. Solvency - its ability to pay its obligation to creditors and other third parties in the long- term; 2. Solvency - its ability to pay its obligation to creditors and other third parties in the long- term;

3. Liquidity - its ability to maintain positive cash flow, while satisfying immediate obligations; 3. Liquidity - its ability to maintain positive cash flow, while satisfying immediate obligations;cash flowcash flow 4. Stability - the firm's ability to remain in business in the long run, without having to sustain significant losses in the conduct of its business. 4. Stability - the firm's ability to remain in business in the long run, without having to sustain significant losses in the conduct of its business.

Assessing a company's stability requires the use of both the income statement and the balance sheet, as well as other financial and non-financial indicators. etc. Assessing a company's stability requires the use of both the income statement and the balance sheet, as well as other financial and non-financial indicators. etc.

Financial ratiosFinancial ratios face several theoretical challenges: Financial ratios They say little about the firm's prospects in an absolute sense. Their insights about relative performance require a reference point from other time periods or similar firms. They say little about the firm's prospects in an absolute sense. Their insights about relative performance require a reference point from other time periods or similar firms. One ratio holds little meaning. One ratio holds little meaning.

Seasonal factors may prevent year-end values from being representative. A ratio's values may be distorted as account balances change from the beginning to the end of an accounting period. Seasonal factors may prevent year-end values from being representative. A ratio's values may be distorted as account balances change from the beginning to the end of an accounting period. Financial ratios are no more objective than the accounting methods employed. Changes in accounting policies or choices can yield drastically different ratio values. Financial ratios are no more objective than the accounting methods employed. Changes in accounting policies or choices can yield drastically different ratio values.

Types of investment analysis investment analysis investment analysisFundamental Industry Company Economic Technic al

Fundamental analysis of a business involves analyzing its financial statements and health, its management and competitive advantages, and its competitors and markets. Fundamental analysis of a business involves analyzing its financial statements and health, its management and competitive advantages, and its competitors and markets.financial statementscompetitorsmarketsfinancial statementscompetitorsmarkets

Fundamental analysis lets investors find 'good' companies, so they lower their risk and probability of wipe-out.(вероятность полного банкротства (уничтожения).

There are several possible objectives: to conduct a company stock valuation and predict(предсказать ) its probable price evolution, to conduct a company stock valuation and predict(предсказать ) its probable price evolution,stock valuationstock valuation to make a projection on its business performance, to make a projection on its business performance, to make internal business decisions, to make internal business decisions, to calculate its risks. to calculate its risks.risk

Technical analysis maintains that all information is reflected already in the stock price. Technical analysis does not care what the 'value' of a stock is. Technical analysis maintains that all information is reflected already in the stock price. Technical analysis does not care what the 'value' of a stock is. Technical analysis Technical analysis

Investor starts his or her analysis with global economics, including both international and national economic indicators, such as GDP growth rates, inflation,, exchange rates, productivity, and energy prices. He or she narrows his or her search down to regional/industry analysis of total sales, price levels, the effects of competing products, foreign competition, and entry or exit from the industry. Only then does he or she narrow his or her search to the best business in that area. Investor starts his or her analysis with global economics, including both international and national economic indicators, such as GDP growth rates, inflation,, exchange rates, productivity, and energy prices. He or she narrows his or her search down to regional/industry analysis of total sales, price levels, the effects of competing products, foreign competition, and entry or exit from the industry. Only then does he or she narrow his or her search to the best business in that area.economic indicatorsGDPinflationexchange ratesproductivityeconomic indicatorsGDPinflationexchange ratesproductivity