In: Finance
Q1: What are the six phases in the financial statament analysis from work?
Q2: Information provided from federal reserve board that shows recent economic data, what is that called?
Question 1:
1. Identify the characteristics of the industry : what are the chain of activities for the creation,manufacturing and distribution of the products.
2. Identify company strategy : next we look at the nature of the product,it's uniqueness, brand loyalty and control of costs .
3. How is the quality of the firm's financial statements : how fairly does the financial statements of an organisation determines the financial position of the company . Weather the balance sheet is a completed representation of the firm's economic position.
4. Analyze the profitability and risk : analyze the ratios related to liquidity ,asset management and profitability , debt management .
5. Prepare the forecast of the financial statements: finance proffesionals must make reasonable estimate about the future of the firm.
6. Value of the firm : there are many methodologies to determine the value of a firm, the most common methodolgy I she discounted cash flow methods . The cash flows are in the form of projected dividend. Other approaches are the relative cash flow method.
Question 2: the information provided from federal reserve that shows the recent economic data is called the FRED ,which stands for federal reserve economic data.