1.6 REVIEW OF LITERATURE 1.6.1 Title : An example of the use financial ratio analysis of Motorola Author Name: Collier.
H, Grai.T, Haslitt.s and McGowan.CB Publication Date /Year: March 2004. Abstract: In this paper ,we demonstrate the use of actual financial data for financial ratio analysis. We construct a financial and industry analysis for Motorola corporation. The objective is to show student exactly how to compute for an actual company. This paper demonstrate the difficulties in applying the principles of financial ratio analysis. We use Motorola as an example because the firm has several segments, two of which account for the majority of sales and represent two industries that have different characteristics. Motorola has the better liquidity position, with both the current ratio and the quick ratio being higher than the industry average.
1.6.2 Title : A Study on Financial health of cement industry Z score analysis Author Name: Dr. M. Score, S.Vanitha, M.Babu. Publication Date /Year: March 2002. Abstract: Z score analysis has been established by Edward I.Altman 91968) to evaluate the general Trend in the financial health of an enterprise over a period. Many of the individual accounting ratio used frequently to predict the financial performance of the enterprise may also provide warning when it is too late to make a corrective action. There is no internationally accepted standard for financial ratio against which the result can be compared. Therefore Edward I.Altman combined a number of ratios ( liquidity, Leverage, activity, and profitability) to form an index of the probability, which was effective indicator of corporate performance in predicting bankruptcy. Z score analysis was applied to evaluate the general trend in the financial health of Indian cement Ltd by using ratio analysis. The cement company under the was just on the range of financial collapse. The financial health of the company was never in the too health Zone during the study period. However Z score in 2002 rose to healthy zone while the score for the fiat study period (1998-2001) had fallen in bankruptcy zone. In the total financial performance of Indian cement was very unviable. If India cement fail to take urgent steps, total failure of the company was inevitable and certain in the near future.
1.6.3 Title : A Study on financial condition of Agricultural producers. Author Name: Dr.Paul Elliger. Publication Date /Year: Jun 1997. Abstract: Lenders are using more comprehensive and method to evaluate the performance and financial condition of Agricultural producers. Financial ratios are integral component within these methods. Ratios are excellent tools to measure and monitor performance of borrowers over time or compare borrowers to a peer group or benchmark furthermore, credit scoring models are often based on specific ratios. The increasing reliance of credit scoring system and other methods places increased significance on the quality and consistency of the ratio values. The ratios may not always be leading indicators of financial performance. One needs to look behind the number to investigate if the ratio truly reflect strong or weak performance. When comparing a specific producers, be sure to look beyond the ratio value. Make sure to disentangle difference and changes in ratio that result from specific accounting method, marketing patterns and tax issues from differences that truly performance and financial condition
1.6.4
Title : Financial Statement Analysis Author Name: Rashid Javed Publication Date /Year: June 4, 2011
Abstract: All financial statements are essentially historically historical documents. They tell what has happened during a particular period of time. However most users of financial statements are concerned about what will happen in the future. Stockholders are concerned with future earnings and dividends. Creditors are concerned with the company's future ability to repay its debts. Managers are concerned with the company's ability to finance future expansion. Despite the fact that financial statements are historical documents, they can still provide valuable information bearing on all of these concerns. Financial statement analysis involves careful selection of data from financial statements for the primary purpose of forecasting the financial health of the company. This is accomplished by examining trends in key financial data, comparing financial data across companies, and analyzing key financial ratios.
1.6.5 Title : Outreach and Financial Performance Analysis of Microfinance Institutions in Ethiopia Author Name: Befekadu B. Kereta Date /Year: July 1995.
Abstract: The paper examines the performance of MFIs in relation to outreach and financial sustainability. It reviews literatures on core performance indicators of MFIs. The literatures noted that MFIs could be examined through three main polar: outreach to the poor, financial sustainability and welfare impact. The welfare impact assessment is not covered in this paper due to time and money limitations. From financial sustainability angle, it is found that MFIs in Ethiopia are hopeful. They are operational sustainable measured by return on asset and return on equity and industry's profit performance is also improving over time. While, dependency ratio measured by the ratio of donated equity to total capital decline, ratio of retained earnings to total capital is raising letting the industry to be financial self-sufficient. Using Non performing Loan (NPLs) to loan outstanding ratio indicator the study found out that MFI financial sustainability is in a comfort zone with average NPLs ratio of 3.2 percent for the period from 2005 to 2007. The study also found low but increasing default rate.
1.6.6 Title : The Corporate Social Performance and Corporate Financial Performance Author Name: Jennifer J. Griffin ,John F. Mahon Date /Year: Jun 1997.
Abstract: This article extends earlier research concerning the relationship between corporate social performance and corporate financial performance, with particular emphasis on methodological inconsistencies. Research in this area is extended in three critical areas. First, it focuses on a particular industry, the chemical industry. Second, it uses multiple sources of data-two that are perceptual based (KLD Index and Fortune reputation survey), and accounting measures in the corporate social performance and corporate financial performance (CSP/CFP) literature to assess corporate financial performance. The results indicate that the a priori use of measures may actually predetermine the CSP/CFP relationship outcome. Surprisingly, Fortune and KLD indices very closely track one another, whereas TRI and corporate two that are performance based (TRI database and corporate philanthropy) in order to triangulate toward assessing corporate social performance. Third, it uses the five most commonly applied philanthropy differentiate between high and low social performers and do not correlate to the firm's financial performance.
1.6.7 Title : Financial Management and Ratio Analysis for Cooperative Enterprises Author Name: David S. Chesnick Date /Year: Jun 1997. Abstract: Financial statement analysis can be beneficial in this respect because it highlights a firms strengths and weaknesses. Data from a cooperatives financial statements reveal the companys financial condition. Examining common-size statements, cash flows, and financial ratios provides management, members, and creditors a glimpse of the cooperatives strengths and weaknesses. The value of a particular ratio compared with a target range of values indicates the firms financial health, and also identifies potential problem areas. As with all analytical methods, common-size , cash flow data, and financial ratios must be used in the light of other relevant facts. Also, the analyst must remember that financial statements are a snapshot of a firm at a particular point in the past. In a highly seasonal industry, conclusions drawn through The main objective of financial analysis is to sort through that information to find useful and relevant data in analyzing a business. Literature is rich with financial analysis tools that examine the performance and strength of businesses. However, not all businesses are alike. Some ratios help analyze the cooperatives financial performance and cash flow analysis. Managers and creditors should find these findings helpful in appraising the financial strength of the cooperative. While there is no set standard at this time, using these analysis tools should help the cooperative develop its own performance measurements.
