F describe the steps in the financial statement analysis framework.

Question 1

Steps in the financial statement analysis framework

Answer 1

State the objective and context before we gather, process, analyze and interpret data. Then report the conclusions or recommendations and update the analysis.

Question 2

Stating the objective and context

Answer 2

Questions to answer, present information in what form, available time and resources

Question 3

Gather data (collect inputs via financial statements)

Answer 3

the companies business, financial performance and position

Question management, suppliers and customers. Visit company sites.

Question 4

Process Data

Answer 4

Adjust financial statements: Ratios, graphs and common-size balance sheets.

Question 5

Analyze then interpret the data

Answer 5

Answer your specific analytical questions. Make conclusions - come to recommendations.

Question 6

Report the conclusions or recommendations

Answer 6

Report in the intended audiences language and comply with Code and Standards.

Suggestions: Earnings projections, valuation, business summary (risk, industry, competitive analysis), historical performance, forecasts.

Question 7

Follow Up

Answer 7

Periodically repeat all steps