Summary Analysis and interpretation of information by Rivah

ANALYSIS AND
INTERPRETATION OF
INFORMATION

by Rivah Steenkamp

, PLEASE NOTE: THE CONTENT PROVIDED IN THESE GUIDES IS A
SUMMARY OF KEY INFORMATION INTENDED TO HELP YOU FOCUS ON
IMPORTANT POINTS AND IMPROVE YOUR MARKS.

KEY CONCEPTS
Profitability Focuses on the company’s profit andhow assets
are used efficiently and how operations are
effectively managed.

Liquidity Focuses on the company’s ability to pay off all its
debts.

Solvency The company’s ability to pay off all its debt.

Return Indicates shareholder’s fair or unfair earnings on
amount invested.

Risk and gearing Focuses on wether the company will be able to
meet long-term obligations and the risk factors.

Share price and Used to compare the company’s perfomance from
market prospect one year to the next and to other companies in the
same market.



FINANCIAL INDICATORS ARE CALCULATED USING INFORMATION THAT IS
FROM FINANCIAL STATEMENTS

FINANCIAL AREA ITEMS FINANCIAL
STATEMENT INDICATORS

Statement of Profitabil  Sales  % gross
Comprehensive ity  Cost of sales profit on
Income  Operating sales
expenses  % gross
 Operating profit profit on
 Net profit after cost of
tax sales
 % net
profit on
sales
 %
operating
expenses
on sales %
operating
profit on
sales