CHAPTER ONE: INTRODUCTION
Background of the study
Statement of the research problem
Justification for the study
Objective of the study
Scope of the study
Plan of the study
Limitation of the study
Definition of term
CHAPTER TWO: LITERATURE REVIEW
User of Financial Statement
Management of an organization
Management control system
Method of performance evaluation
Analysis and interpretation of financial
Definition and relevance of financial ratio
Classification of ratio analysis
CHAPTER THREE: RESEARCH METHODOLOGY
Types of Data
Population and sample size
Method of data collection
Method of data analysis
Brief History of First Bank of Nigeria Plc.
CHAPTER FOUR: PRESENTATION AND ANALYSIS
4.1 Socio – demographic characteristic of
4.2 Presentation of Questionnaire response
4.3 Testing of hypothesis
4.4 Result and Analysis of Liquidity ratio
CHAPTER FIVE: SUMMARY, CONCLUSION AND
OF THE STUDY
concept of business entity in accounting practices which defines business as a
separate entity from the owner brings forth stewardship reporting and
accountability in any organization.
Mores, the going concern concept anticipates a continuous life a firm within
a foreseeable future. That is why the
ultimate determined of the remain perpetually.
the aim or objective of financial manager is to provide meaningful financial
information about business enterprises to the outside world and for internal
control and management in decision making.
These financial information are presented in financial statement. They are means of conveying to the management
interested outside a concise picture of the profitability and financial
position of a business. They constitute
a report of managerial performance attesting to the managerial success or
failure and flashing warning signal of inpending difficulties. (Meigs and meigs 1979), so financial
statement obviously important to enable the user that have a clear picture of
the position of organization. It reports
the liquidity and solvency of the company and the claim of these resources i.e
debt owned, the equity of the owner and presents cash present cash position of
comprises comparative balance sheet, profit and loss account, income statement,
cash flow statement, auditors report and some other necessary information base
on year’s assessment.
the fixation of financial statement, many user often fail to comprehend fully
the information it intended to pass across, thus their desire one not met. This is due to the ambiguity of the financial
statement where by the where by the volume of the data and figure mislead the
users. In this sense, the analysis and
interpretation of the statement are imperative.
statement can be converted and interpreted using three techniques.
Vertical or Static Analysis:- It examines relationship within a
statement. It deals with the relative
percentage value of the statement.
Horizontal or Dynamic Analysis:- This involves comparison of financial
statement in respect of two more years.
A weakness of this analysis is that comparism with the past does not
afford any basis for evaluation in absolute terms.
Ratio analysis: Is a commonly used technique
in analyzing financial statement and it involves these of two difference
economic units to ascertain performance.
obviously paramount since it practically evaluate performance that is check how
strong or weak a company is. Therefore
its interpretations are easily understand by the users.
OF THE PROBLEM
Ratio Analysis is a widely used took assessing the performance of an
statement is prepared in terms of historical costs. They do not fully reflect economic resources
and managerial, hence poor decision may be made. The users of financial information are
carried away by the figures displayed in the financial statement observing the
trends of the financial investment while over – looking the performance of
management as assess whether their resources have out to effective use. The analytical comparism of a large
information is a problem to the users (The management of the company and the
external users. Investors, analyst, creditor government and public.
FOR THE STUDY
analysis being what it is are the production of relations for internal and
external financial reports are important to summarize key relationship and
results in order to appraise financial performance.
this assessment this research will be of immense value in recent knowledge of
at the enterprises and managerial achievement.
This research is very useful to user of account and financial
information. It is also to supplement
the existing of the user of financial ratio as guide towards deterring
company’s achievement as well as to show how financial ratio analysis can
identity the strength and weakness of a company.
research work can also serve as a material for students who are interested in
the study of financial rations as a tools for performance appraise.
OF THE STUDY
study into financial ratio analysis as a tool for appraising performance is to
assist the use of financial information make decision predict the future and
monitor possible irregularities in managerial behaviours in business. Thus the main objective of study are:-
To determine the strength, weakness and
opportunities based on the firms financial statement or performance and the
threats to the continued existence of the organization.
To assess the extent to which ratio analysis
serves as techniques aid in decision making by management. To find out the
extent, which the management. To find
out the extent, which the management of the company has been able to run and control
effectively and efficiently, the assets and owners equity between the period
To find out the extent to which the trends
indicated ratio are useful for prediction of the future last to make
recommendation to the company.
is assumptions upon which the research base his finding for a data
collected. The hypothesis basically
formatted to be tested.
Ratio analysis cannot serve as a tool for measuring managerial performance.
Ratio analysis can server as a tool for measuring managerial performance.
Ratio analysis can not serve as tool for measuring managerial performance.
Ratio analysis can serve as a tool for measuring profitability and efficient of
chi-square is used to test validity of the hypothesis.
OF THE STUDY
study has been limited five years financial summarize of First Bank of Nigeria
PLC. Profit and loss account the value
added statement using ratio and adequate interpretation was analyzed.
study is carried out base on the fact that account represents a true and fair
view of the company’s affair and not misleading.
financial ratio will be compared with that of previous years using common size
of statement, treads analysis i.e reaction of the economic unit overtime of the
firm horizontal analysis.
period was choosing because of its available financial statement representing
its operation within the period 2002 to 2006.
OF THE STUDY
research is written to examine financial ratio analysis as a tool for
study begins with chapter one that deals with background of the study statement
of problem justification of the study and definition of terms. Chapter two deal. With the literature review of the work of
other author related to this research.
Chapter three emphasizes on research methodology: type of data
population and sample size, method of data collection, method of data analysis
and brief history of First Bank of Nigeria Plc, Ilorin Chapter. Chapter Four embraces the data presentation
and analysis testing of hypothesis result and analysis of liquidity ratio. Chapter five deal with summary, conclusion
OF THE STUDY
the cause of carrying out the research the following limitation are
encumbered. The limitation of the study
is majority the limited available and strick access to some data’s demanded by
the research from the appropriate body in the organization as a result of high
work schedule but however due to continuous patronage the data was later
problem that limited against the smooth conduct of this research work was the
high cost of transportation and also strick assess to other schools library but
with the help of financial support both from our parent and school authority,
the stress or limitation was over come.
Is the ability to operate as well as action or achievements consider in
relation to how it is (Oxford Advance Learners Dictionary 1995).
statement: Are the instrument panel of a business enterprises and constitute a
report on managerial performance attesting to managerial failure or success and
flashing warming signal impending difficulties (Meigs and Meiga, 1979).
Is a simple mathematical expression as well as one member expressed in term of
another to show the relation between them and is the most widely use tool in
analysis and interpretation of financial statement.
sheet: A statement that show the financial position which summary or the nature
and amount of company asset and liabilities and net worth of company in
and Loss account: Is an account that shows either the net or profit of the
company usually in a year where by the income of such company are credited
while their expenses are debited during the preparation of their account
capital: Is the excess of current asset over current liabilities of the business
flow statement: Is a financial information which provide information about the
cash receipts (cash inflow) and cash payment (cash outflow) of an enterprises
over a given period of time or in a given accounting year