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Analyzing Financial Ratios Practice Aid – Forensic and Valuation Services (Formerly BVFLS) Practice Aid 06-3

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Description

Analysis of financial ratios is one of the most diverse tools a CPA can utilize. Ratios can be used to compare a company’s performance to industry standards or to similar companies in the same industry:

  • to determine the strengths and weaknesses of an organization’s operational areas
  • to monitor changes in key business evaluators
  • to reveal many more critical indicators affecting business decisions

This updated AICPA Practice Aid shows how to use ratios to support the conclusions of an engagement. It also provides a sample study of the practical use of ratios in a fictitious engagement.

This Practice Aid supersedes Practice Aid 94-4.

Table of Contents

  • Scope of this Practice Aid
  • Typical Engagement Situations
  • Engagement Acceptance Considerations
  • Engagement Objectives and Client Benefits
  • Engagement Scope
  • Engagement Approach
    • Preparation
    • Analysis
  • Engagement Outputs
  • Appendix A: Suggested Sources of Comparative Data
  • Appendix B: Financial Ratios: Formulas and Interpretations
  • Appendix C: Case Study: Historical and Comparative Financial Analyses for the Remlap Company
    • Exhibit C-1 - The Remlap Company-Balance Sheet as of September 30
    • Exhibit C-2 - The Remlap Company-Condensed Statement of Income for the Period Ending September 30
    • Exhibit C-3 - The Comparative Balance Sheet as of September 30
    • Exhibit C-4 - The Comparative Condensed Statement of Income for the Period Ending September 30
    • Exhibit C-5 - Ratio Analysis for the Remlap Company for the Years Ending September 30
    • Exhibit C-6 - Ratio Analysis of the Comparative for the Years Ending September 30
  • Appendix D: Sample Engagement Letter
  • Bibliography

Excerpts

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Paperback 2006
Product# 055302
Availability: In Stock
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