Each participant will select his / her own organization (If the selected organization does not have an annual report then select any other organization of similar in nature) and collect annual report containing financial statements (statement of income and expenditure, statement of sources & application of funds and cash flow statement) for 5 years.

What will you do?

Apply concepts discussed in class, and do financial statements analysis and interpretation to understand financial health of selected organization(s) using tools (ratios) and techniques (costing)

You need to analyze and interpret financial health of an organization i.e.

a. how organization has been doing for last 5 years (trend analysis),

b. how organization is doing vis--vis its competitors in last 5 years (comparative analysis) and

c. how organization is doing vis--vis its industry average in last 5 years (industry comparative analysis).

How will you do?

Collect financial statements of organizations (Bloomberg database) and, analyze and interpret financial health in terms of its

i. What should be the focus (revenue maximization or cost minimization) of your selected organization(s) to maximize profits. Analysis and interpretation base on data

ii. Riskiness arising out of its cost structure (Do CPV Analysis),

iii. Liquidity position i.e. organization(s) ability to meet current liabilities from current assets and ability to convert current assets into cash (Assets Utilization),

iv. Solvency and Leverage position Both Operating leverage (how EBIT is sensitive due to change in revenue) and financial leverage (how EPS in sensitive due to change in EBIT), Organizations ability to meet financial obligations (Interest on loan), etc. Debt to Equity Ratios etc.

v. Profitability Position Economic Profitability (profit generating capacity from effective utilization of its assets or capacity), Commercial Profitability (profit generating capacity from revenue) and Owners Profitability (contribution of profit to owners)