Assessment of the company's financial condition is necessary for drawing up further planned indicators and consists of calculating the fundamental coefficients for the formation of working capital.
Instructions
Step 1
Make a calculation of the data that characterize different aspects of the organization's activities related to the emergence and use of its cash flows.
Step 2
Calculate the value of the liquidity ratio, which reflects the company's ability to meet short-term debt obligations. In order to determine the absolute liquidity indicator, which determines the amount of coverage of short-term debt obligations not in cash, but with the help of securities or deposits, it is necessary to correlate the amount of cash and the value of short-term investments with the available amount of current liabilities.
Step 3
Determine the quick liquidity ratio. It can be calculated in the form of the ratio of the most liquid amount of working capital (short-term investments, the amount of accounts receivable and the amount of cash) to the value of short-term liabilities.
Step 4
Determine the current ratio. You can calculate it as a quotient of the ratio of the amount of working capital and short-term liabilities. You will see how much the firm has funds that can be transferred to pay off the amount of short-term obligations.
Step 5
Calculate the coefficients of profitability. These metrics will help you gauge how profitable a company's manufacturing is. In turn, the value of the return on sales ratio will show the part of the profit that was received from the volume of all sales made. You can determine its value from the ratio of the amount of net profit and the number of sales, multiplied by 100%.
Step 6
Determine the amount of the return on equity indicator. This ratio reflects the efficiency of the use of equity capital. You can calculate it using the following formula: divide the net profit by the amount of your own cash investments, then multiply the resulting value by 100%.
Step 7
Write the conclusions based on the calculations made. After that, you can indicate the planned values for the next year, comparing the data with the obtained indicators.
