2. Tutorial:Business Academy Topic: Financial business analysis Prepared by:Ing. Marcela Zlatníková Projekt Anglicky v odborných předmětech, CZ.1.07/1.3.09/04.0002 je spolufinancován Evropským sociálním fondem a státním rozpočtem České republiky.

3.  Financial analysis measures the data from financial statements mutually  The aim is to express a complex financial situation of a business  The analysis shows not only the past development, but also helps to choose the most appropriate directions of further development of the business  Users of the financi al analysis are namely: managers (business administrators), investors (shareholders, partners), banks and other creditors, the state and its institutions, customers, suppliers, employees

4.  The data recorded in the accounting are summarized when balancing books into financial statements: * balance sheet * profit and loss statement (income) * annexe Financial statements may be extended for a summary of financial flows (cash flow) and for a summary of changes in equity. Financial statements may be: ∙ scheduled (31.12.) ∙ non-scheduled (e.g. at the date of stutting down the company without liquidation) ∙ interim ( during the accounting period, e.g. changing legal form)

5. Some businesses are obliged to verify the financial statements by auditor. These are large companies, activities of which significantly influence national economy. These include: ∎join stock companies, if they achieved at least one criterion ∎other companies and cooperatives, if they achieved in the accounting period at least two of three criteria: 1/ The assets are more than 40 million crowns 2/ Net turnover is more than 80 million crowns 3/ Re-counted number of employees is more than 50

6. AUDIT – is a process in which a charged person (auditor) examines the information contained in the financial statements, he or she evaluates the documents to form financial statements and expresses his or her opinion on the quality of financial statements. Businesses which are obliged to audit, attach to the financial statements the annual report. Financial statements may be drawn up: √ in full range ( businesses subjected to audit) √ in simplified range ( other businesses)

7.  It contains information about the state and structure of property (assets) and sources of financing out of which the property was acquired (liabilities) at a specific point of time  In the balance sheet there are three types of figures expressed in crowns: GROSS (rough state) – there is recorded property in prices current in time of its acquisi ti on CORRECTION – deducted from gross state, e.g. adjustments of value, correction items NET – it is di f ferential value of preceding items ASSETS are divided into: receivables for assigned personal capital, fixed assets, current assets, other assets LIABILITIES are divided into: personal funds, other funds, remaining funds

8.  It contains data about costs, revenues and the results of economy for the current and previous accounting period  Revenues and expenses are divided in order to find out commercial margin, the result of manufacturing activity added value size and individual components of economical results  The statement is organized in steps  Commercial margin and added value are differential items that have economic importance

9.  It explains and completes the data in the balance sheet and profit and loss statement  Its form is chosen by the firm itself and it may be a table or it may have descriptive form  It namely contains information about used accounting methods, changes compared to previous accounted periods in the organization and marking items in the balance sheet and profit and loss account and description of the used valuation of stock

10.  It is a statement of the flow quantities  Cash flows are increases and decreases of cash resources and cash equivalents  Cash flows are monitored in division into operating, investing and financial activity  The main problem is to transform cost and revenue items into cash flow form  Direct and indirect method is used

11. 1/ Distinguish personal and other funds of a business 2/ Name some components of current assets of the company 3/Explain why the balance equation - that assets must equal liabilities - should be valid 4/ Which side of the balance sheet includes the achieved profit of the company and why?

12.  Biňovec, K. Přehled učiva k maturitní zkoušce z ekonomiky. Fortuna, 2004. ISBN 80- 7168-747-2.  Švarcová Jena, ing a kolektiv, Ekonomie, stručný přehled. Ing. Jena Švarcová, Ph.D., CEED nakladatelství a vydavatelství, 2006. ISBN 80-903433-3-3.  Klínský Petr, Munch Otto, Ekonomika pro obchodní akademie a ostatní střední školy 1- 4. Fortuna, 2003, ISBN 80-7168-862-2.