The Need Of Financial Statement Analysis In A Firm/An Orgnization

Financial statement analysis play a dominate role in setting the frame watt of managerial decisions through analysis and interpretation of financial statement. This paper discusses about financial „ strength and weakness of the company by properly establishing relationship between the items of balance shed and profit and loss account. In order to judge the profitability and financial soundness of the company horizontal, and vertical analyze or done. The various technique used in analyzing financial statement included 'comparative statement, common size statement, trend analysis and ratio analysis. The results suggest that the ratio approach is a highly useful tool in financial statement analysis, especially when a set of ratios is used to evaluate a firm's performance.