Tools for Financial Statement Analysis-Comparative Statements and Common SizeStatement

Trrasludyollhis chaplershouldenabeyoulouideGlandlr Moaning of comparali€ Financ al sIar€mgnls:r Purp.se ol compaauv€ Frnanciarsiaiom€ntsf compahirve Baranca sh6€iso Conpaialiv€ lncome SlaldmentsO Comnon Size Sblemenls

Th3 a.counlins ptucess ends with lhe produdion of..nual ..coun1s conprhingBalance Sheet, Profit and Loss Accounl a.d Cash lldn Slaicncnt, Nhcrc apDlicableaDd suppoted by ur€ sddiiiond information thmush Notes to A.couts and Dimclors'Repoi to 1!e s\eloldeF the fnm.i3l stahrenb € mmg€d into puposive clssesso llul naximum nrlomaiion fr.n dll! is obiained for the pllpose olanalysis.

Iimncill siatenents Nhen analyzcd in isolalion are not ol nuch ncanirg and uso.The finscial stalenenis, in order to anirc ai .easoncd .ondusions, should beanalyz€d either rvith ielerence to t]r3 finan.ial statcnenls of ca.lier periods or wilhref€rcnce to finmcial statements ol oiher entcrprises ol sinilar sizc md ol dating inthe snnilar business enli.oDDenl. T!€ lools to cary oul nnancial malysis in.ludc:1 Codparalirslalcncnlsl2. Common Size Statenents!

4 C$h Flor Strienents, and5. Fuds !lo{ St.tcncnts Wcshall nordiscuss Funds llow Sla

In this Chapter, we shsll discuss Conpa.afive Statenents and Connon SizeStaten€nls $ iools olmalysis olnnsncial slalenents

COI\IPARATIVE STATEMENTS

Conparison ol lin..ci al sktemenis inlolves the .om pa raiive studJofcomponenis olProlit and Loss A.couni and the Bllanoe Sheet over. neriod oliwo or nore yearsk^awt as tnbd.lim Cotupotita, r comparison silh dala or .nolhf firn Lno.vn asInt t.fim Cary)aritar at .onparhon ol actual liglr* with the hudgct, d conlarison

anousis at Fho1Liol sL1t?n4ns-x

I 3,1ai do you unde.srand by an6lysis ot ddmp6r6tive balanoe sheets?

MEANING OF COMPARATIVE FIN

Conprralive linsnciat Ststenent js a tool of linan.ial analtsis !ha! dcpicls changcin elch iten of fi€ nnsncial stat€neni in botn absolute anouni a.d per.eniase tern.laking the iton in preceding accomti.s period ss base.

Tlte dat. Md infornation that is being conpared sbould be p.esented in a namerlhat lhere is no dhsimil..ily betwcen lheh si.ce a .ompariso. of dissinilar d.tavould rake the sndJsis s€snincless Thus, w€ cm say thrt comp*alive nnbcial

pared in a nanne. that the drta presented is dn

Conp.rdiivc st.tcdcnls n.y be preparod lo dhow:(t) Absolulc Data-Rupc. anount only.

(it) In.r.asc or dcdcas c in Absoiute Data in tcms ofhoney valna(iti) Inolasc or dcucasc in Absolute Dlta in tems olpe.centqe.(i,) Conprrisons cxDr.ssdd in.aiios.(, Pcr.cnt.e! of lohls.

oblecrrves or Purposesof comparatve Flnancial statede.ts1 Compa.ative statements giye informslion about lhe nalu.e olchsses innuencins

iinao.ial posilion and pe.foroance ol an entertrhe. Fron the financirl poin! ofrieu, i}€y rre ve.J usetul.

2. These stafenenrs poinr our the wealness rnd soDndness rbolt liquidty, proffiabihJ.nd solvcncy of M cntorprise.

1.

BJ an.lysis ol chang.s of nmncisl &t3 ol previous J€aE, these statene.ts helpihe

'nanagemert in lorecasting andpl.nning.

ThcJ rre a gxide to lully unde.siand ihe novements ol the key financial sialislics.

Tools lor Comparison of Fin.ncl.l Slabmenlsconpaison nd $rlysis ol linanci.l slalcments n.t bc car.icd oui usi.g thc

r. compsmtive Balm.e sheets:2 CompeEtive IncoDe Stliemenlsi and3 Common Size Siaiemeni.

COMPAFAl IVE BALANCE SHEEIS

''conporutioe balonce shet andlllis is t ]E sru.b oft he trend aft h. sa'p irents, ctaupol itehf dn.l ontrute.l .ns i tao ot nore balan.e Je?ts of the nnle bdinest?ntutptie an.litfen t.Iaras.' -rourtaComparative balance sheeis ola..nl.rprisc as on r{o or no.c datcs un bd uscd forconEring assels, liabililies rnd crptrl and *certaininq inclease a.d decrease inthose itcns. Such a.alysis dftun rrelds considerable infornaiion w]rich is olvalue in;''"s Ie,r'",oi'?e3.d'srh, r.oa'-.ol.h.rn..'p'r.

ranDoatiw s?dt n.nls dnd ConDon Sk Siok,,p,.s

Adv.ntg!.. ol cofrparatlv. g.lance sh.€|.r A sinsle balbcc shei snows the bslmod of ac6ut6 nftar clding the books on s

e.tain d.1e. wher* th. cobpaEtw€ ballnce slet shows .ot only the b.lde ola@ur3 N on difi.reni dater bui.l$ rh€ €nent or their incENs or dk&.t6

2. In a single balan.e sheol, lhe enphnsk i! on sbtus, shercas in ih€ conpd.aliv.bdlsce sho€! ihe enlharis i3 on dD.ge.

3. A bal&ce rhei E a ulcful slatenenl b!! lhe cdnparaiivo balan.e sheei is evennore usefd s it onilins not odJ th. dltl of singl€ balonce 6het bn. ale thce*hich m.y ba used i! siudyi.g tle td.& in bcin*s onem.

-1 It sloes lhe etrecis ofb$inels op€niio! on irs ssets,liabiliti€s md capit.l. Ii is acom..li.t link bel{ftn the Balan@ Shecl and the Prclii od Loss Account.

PrepaEtlo. ot compardrlv. B.lsnce she.l.A mnpMrive Bar,m Shet hs 6v€ @tlls. ond osiEts ollhe folNing jnfomation:

rr.d Collzni In ihis mlunn, fte it€d of Boldce Sh@t !b ent€red.Smnd Colr'''i In this column, date (6s!res) of pwiou! yea.k Baran@ Shei e

ftr;d Col!,,r ln this column, drts orcurent yedrs Balon.e Shcet are ellercd,Folrrn Col!'nn: In tlb .ol!nn, ditrer€nce! {increases or decleases) in tgxs6 betsscnth€ praious lccoutins pcridd md currcni ac.ouniiig De.iod arc shom.afn cdilnni ln ihis coluDn. rne abde difiepdcB (incca64 or ds€es) cxpEssedE pe.ont.ee ft shM..

FORIIAI OF COMPARATIVE BALAI.ICE SHEETS

cnnpsnvE urac€ sHEErs 0onlzoNT r FoR l

E rKb'9hftdrle4,odl@)

AnoLyis al Fnnn i.l statenrnt*xll

nhsh.iion 1 From tnc fouosing Bdsne Shcets ol Exe Ltd. on 31st March,2007and 2003, prepaie a Conparaiive Balance Sheet:

q!s4L

,::':

=ry

r?4 ! !c-

C. workins Capi!.I (A B)

Analysis.nd lnlelprelation

!!!!!!_!.aqpqq

6,00,000qqg,!!q

The sDalysis of the above CoDpnalivc B.lnn.e Sheets EiYss the folowine cdnclusions:

l Toial fixed asseis weF inoeased by Rs.3,00.000, i e,2S4, increase in fx.d asselsThis *!s fi nan.ed by in€ issue oloquity shgres The oxp..sion olnxed assels nlvhave Esull.d in i..rexed pllnt caDaciiy, incress.d produ.riliiJ of existinB planlor d edease d uni ! .osi ol operations

2 Prefc..nce shar. c.pital k incused byRs.3.00,000, t.e.,100% inc.ca6..l! nakesthe linancial Dosition ollhe conpmy strone.

3. The working capital is increassd by Rs.3.00,000,;.?., 100%. Thus, ii appears io be:atisfactory fron the point ol vies ol ihe capeciiy olthe businBs to pay off ii6.unenr tiabiliiies as md when rher &lt dDe tor Faynenl

! Capilal enployed is i.cEased by 33Xti drcio 25%increase in nxed assek5 There js no increase in debentue liability and also the increase i! ihe cunen!

liabilities i3 only busrnal.

-^6ore prckatdtian ol canQdtatiue Babne shpb G in tine uith tL. h.tizontdl fottu

'iprtsentation os pet schedlle vI afthe campanies At, 1956. Betier and morc Geful

infomation cm be obtained by pEprins Conparative Bal.nc. Shcct3 in acco.dDceFirh th! vc.iical fom ofpEsenlaiion !s per Schedule \,'L Profdrm df ConparaiiveBalancc Shcets Eeneraly used in Drucrice is as under:

Pr$ontaiion of comF.alive B.lnnce sheels (b.sdd on Iuustreiionline rvith ihe verlicat 1016 df prcsentsiion as per Sctedule vI ot lhe1956 is rdven in ine neit prqe:

HEETiVERNCAFOFMI

";3'00.0m ,'|:

Anal$k af Findntial Stutene s-nl

lllNtr ion 2, rrom the follosins infohalion, prepare a Conprative Bal.nce

lcBsE DeLhi aM Oubid. Dethi 1999 set I ond . Maaifadl

lo,'€dAsds-cuE tabi iho1Nd4

'-.1: 1

a:.pat iueStakne 6 dn.tCannonSp. srotun?nts

lotet Catcutatior of \.orhinE capitats3e7Fs) 33m3lFs)

D0o"!00 :mF.\l'ro\,? p4st oton at.anpdloL " Boton ? 5hc4 '

di

,tq!q0,m

Ill$hation 3. Prpare Conparstive lalarce Sheers ofLrltd.:

@f !,!qL

icuierA$b - cur€rr 6 rral Nob)

qLqg

Nola. Colculdtian of lVorhine Capitdl

Arot ) si 3 al Fnto n. iat st ak "n 6-xr r

the follo* irg sunnarised Balmce Sheet of Creen Ltd., p.cparc

1e nkfr9

-=

3ii;

Nore thc above p.esentalian is an aliemsiive presentalion lo prepar. lhe Compsative

nlustntion5,PEp e ihe Conpahiiv. Balance Sheis ofApq Ltd. f.on the folowinginfomation for 1\vo

'.ars ended 31st Mrch, 200? and t0031

Conptrurioe Stutunents dnd Conmat Size Stotutne.*

:{ote Calculstion ofWorki.s Capitsl (t.€., Curenl Assets Cunent tiabililies)

r..i tnerem tuhlsad tdi r ui@red tM)

3'6.nm

Andr s i s af F ino.t ial S t.te no nt *xl I

P.epde Compssiive Balmce Snsels and conDenl on comparaliv. position of

(r)

.- aparahuStottne tEnhd Conror S2€ Siri?D.rr

C.metrLe: The Conp ative Bsls.e Sheeis of.l'Iz Ltd. r*€al lhsl ihe shreloldersalds nave inc&ased by 15 33%. This inoease happens to be the Esult ol an in.rease::.he.ecapital(9.71%) and resene md suplnE (23.51%). The loan funds have aho::deased by 43.44%. Unsecured loam incEased mnsiderablJ by 36.50ti. Ii means:3r tlz Ltd. tapped eqlity shaE capital, secuEd loans and unsecured loans in

.L!eb side ofconptralive Balmce Sheets Ehow application oftunds. Iunds hrve been:ed to scquiE ffxed sseis ss ure soss block of ffxed sseis sho! aD increase ol:;06 . Inveslments hale i.cre$ed by Rs. 1,14,450 (71.06%). Cur.eni assers book::bts od cash md balk baloces tave inae$ed by 60.23t and 9l .69rt resperively,

=nilying t\ai @nsiderable iunds have been pui in cude.t assck. Cutunl li.biliiies

::!e gone up by 73.39%, it means rhar conpany has norc labilitios lo lay in one yea..

COMPARATIVE INCOME STATEMENT

aompaEiive ln@me Stateneni shows ihe ope.aling rcsults fo. a nunbe. of:rounting periods so thai .hanges in data in tems of noncy and pe.cenlage fron:r. period io anoiler nay bc knosn. Thc .omparalive incone statanenl shows ihe:

ir increase or decEaEe in Foss sales.,i) i.dease or docrease in rut sahs,ii) i rease or decrease in oEtolgoodssoldmdiis cruses.i.) inoease or decrease in Crss profil.r) increase or de.r€ase in operating profit.ri) inc.esse or dec.eese in operating expenses,ii) indease o. de.rease ir non operalins e\Tenses.

r itir ana\sis olvarious ilens oiincone.n) analysis ol Nei P.ofil md its percentage with sales.

objectlves ol comparallve ln.ome statements1 To analyse the incone snd *lenditure for lNo or nore years.I To analyse the i.crease or decEase in the in.one a.d dpendiiure in tenns ol

rupee and eho lhe percentage.3. To revj ew rhe business operaiions ol il e l ast yea. an d iis l ikely efecl on ih e cu.reni

Pr€par6tion of Comp.r.livB lncom€ Strtem.nr;\ Companiive Income Slalobent, likc Conpantivo Bala.ce Sheet, is prcpredha ng five colum.s a.d.onsisk ofrh. fdllo\yi.g infomationlFirs, Collan: h this column, lhe ilon ofTrrding Ac.ouni G.9.. ssl€s, cost ofs.ods solddd gross prclil) and Profit tnd LGs Account G.e., ope.aiing eraenseo tr€ eniered.Sscor{, C,/1,/ ln this colunn, the figlres ofprelious year arc enlered.?/td Col!,,r In this colum, i\e liglres ofcurretri year ar. ente.edaoz.i, Col,,nn: I. ihis colnnn, diffeE.ces (incresses or decreases) in ,islrs bsiwcenlhe previ ous ac.ou nl ing period and cuftnl dccountins peri od aE .ecorded

Andllsis af Finontiol Stdtenent*r I

F,/4n Colrftni ln lhis colllm, tho above difibrdces (increses or dedeases) €xpressdin a perccnhage do shown.

" " a,n ree ot Lhe Pr.sou. Y.r

Ssles {c,s1' rnd credit sal6l Ssles Reim.Sold - Op.uc SloLt + N" Purtoses - Di'.c' E*p.nsec

Ncr s,les - Cosi of Goods Sold.

*

4

UIlutFtio! 7, Fron the folosi.g infonation, p.elare Comparaliv€ Inon€

C'n)pototile Stdbnanb ond Cnndrr si,? Siak,,enrs

Os.t{nc Erpen... '.1€'to

lre 'ro'a.r

e^p61s€s daling ro 116 pncpo everu€;dlc no aclivil os r alro k.owr .s ooe'o i' q a cbMU*, or fio €nl€ru i56 b nprs (r) Ctl;eandad;rvakore:Dores16.0,35lary t€lepFdre o€p'*aionasers)'i,sellnsandD sl'ibutdn Erpanss, (t ) cash Dlsdnt allMd lo.uslome6, (/y) Bad Dobis and (v) lr'l€r€slon shon-tem debt6, Provbion tor Doubtlll D6bls.

orcntnq R.v.nu. reler lo r€v€nu. 5am6d lon lhe pdncipl6 Evonue producinq

activiiios. ExadpesofopsEling tevenue includ8: N€tsales olgoodsorse icos, T€ding

NoFperall.q h6m rclorlo lhe incms wh dr arc mtlrcm fte pdnclpaL B.nue pdducinq

&rMFs. Ermd6 ol l\on.op.6ti (r) R€nr R*c6 l) l1l€€sl cndo,e'd61d r€c€ivod ol lone€'tr hv6slr€1 s *d (fl, co.p.n$tion ro amrFt ol ol'andNon-op€Eting Erperu€s Elor lo lh€ exp6ns6s and losses whidh a€ nol relaled ro the

oDo6rnoenv{€s. Eramplee (,i Loss o' scle dlt6d**a atd lonore tr 1€stra1's{;r hana 016 *sE 16 s. sood{ilrpa'6nt5/rade r a d6p!1q1t1 amodas36b (eq., p'e

'f ia'y arp€nsoruted' llg comnissiodo*orl

ss!€ oi shar6 or Debantur*) wrinon oll.

lllustlation a. Fmn thc foltowinq detsi]s, ndke oui Conplrative Inclnc Staienents:

anobsis al Ftno ddt stahnelt*:ttr

li uslEr id 9. lir n ll1r rouoluB inlors ' 'ol oFpf .ontd

"ri\. lnon o sEtsn c1L:

tcBsE Delht 11s6, Mottttd)

mDstration 10, Prepare CompuBtive lnmne Statemenls fron ihe lolowins infonation:

tcasE Ddhi re%, Ma.titun\

ast .dtie staten n6 oad cotuhon si.a stdteh.ntt

tllut ntior ll. Prcparc Conp.ralive L6ne Srlte@nl! olt Ltd., sith the rEb olrle lollsing iDlomtio:

IU@tntion rr. PEpm Conpeativd Inehe Stztonent! of Ahn€d Ltd. vilh lhe)Elp of $e foll@ins;fo alioni

ICBSE Delli 2a0a, Modind)

Atol!8tu alFinn ial stntenint*nl

Note Dire.t expenses sre includ.d in lhe cosl ofsoods sold so they a.c not shorvnsepa.aielJ in conparariv. Incone stat€nenr.Illusrntion 13. Tbe Profil and l,ss A.couni ofNarional Pharns Co.lor the ve*ended 31st March. 2006 and 2007 aE as follo*s:

Conpute percentaee chanses fron 2006 to 200? and conne.t on the changes.

qsn

Irontherbove, we find th* sal€sreveruehas dedincd bJ 12.3?n durirg ihe year.The.osi olgoods sold h$alsodeclined brt, by onlJ 5 ?796. This has resulred in 20tdecline in rhe gloss ptuni. Hosever, ope rali. g cxp.n$s hsve declined by 25%. As a.esuli, dedinc in nor profir is 13t1,. on thc Nhole, the peformance of cnt..p.ise has

14lq

d500 oi5.m0

(anpdtanxc Stokn htsdnd Cod'non SE. Stotru. \

llustntlon r:1. R!.anarlge the folldwins funrus in ih€ loro ofa Conpmtive InmneShEn .1depicli.a the ch.s€s in dbsolut lkxEs @d p€rcntrge, sd give you.views in d.e seni.nce ofnet etect of rhe chanqc.:

!q000_ ,tL1. Sal* hav€ b€cn inqeescd by 20%.2. Gtrs Prc6t hos ben incrca&{t b} 26.6?q1,.

3. OpeotingP.ofit hs been jncreased by 7r.,!31t.4. NetProlirhasbecnincrc$cdby91.67%.5. Non.oDcmii.g E pensc have been red!.ed bj 50*,.

COrli'OT SIZE STAIE ENTS

Conmon Size linanchl Sial€nenle are the strtemcnts in whkh lmounts oiindividudl it b3 ol BaldLc Sh*i .nd P.ofil and Irss Ac.omt (or Inconc Slsten.nl)for $T or nor€ jcr6 are wri1len. Th6e anounts 're fu.th€. converlcd intope.renlns€s to sone.onDon base. h can be Nel Sales in tne.asc orP.oir.nd LossAc.oun! dndt lal ofBaldn.e shcc! for i]re B.lsnce sbcoi. conhon sizc Etstem€nlsnaybe used for b,lance 3hoelas well as inc0me slate ment.Cmnon SIze lrcome St GmentIlis ihrl staten€nl in whioh net sal$ fielre is dssumed io be equal to 100 dnd olh€rfrgxros of cosl 0r expensqs are cxpressed us percentage of !!lca. Comnon sizcstaren€nb for dirl€tunl p€nods help to .cvesl thc €tff.i€ncJ] or oth.D.ise olincreasing any ccr or erp.n*s. lf il k being prcpatud for 1Io lims ir shows th..elative .fi.ietuy of.ost it.ms oflso lirns.Obj@llr. ol Cmtun SIE ln@m. St ten.ntt To oalyse chan8r in individual iteh of Income Strlcmenl2. To 6 t udy the lrend in ditl€renl iic ms ol i.cones .n d .rT€tues

Alalf E otFadrcnt sbknedE xtrPtepabtion ol Connon Size bcon6 St tementlollosing stels s.e nece$ary tor preparing rhe Cdnnon Sik Incone Sraleneni:1, Enicr lhe ilens ofinmm€sia2. Enl€r the abslute anounis of different jrens (t..., Income/Expcnses) of jn.one

siat nent for ih. previous yed in Se.ond Colunn and cu.Ent Jea. jn Third

3 Enter the peeeniag0 rctsrion of diflerent ilens of incone statenenis fo. thepr*iols,\'ear to Net Sales (wtrich js iaken as r00) in Fourit Coluhn.

4. Enr,er the per@nragc .elaiion of ditrereni iiens of in.one skt.,nents tor thocuneni year io Nei salee (which is rdren as 100) in liitb colnm.

FORMATOFCOMMON SIZE INCOMESTATEIIENT

Ilustration 15. Prepare the Co'nmon Size Incone St.renenr rron the tolowing

(1)

o trd d Adm i sudie hpen*14 sd he d odibudM Erps*s

canpdteiue a..utut' dnnco^m sia srditmLts 3.19

fu th. t@ dtu 31't [t Eh, M {d 2&t

t3,

1,1 01!16.r'd ^inrllddh

E!.isli'l s.r i9 rid 0 d'iti.i E:!.ms

nludnti@ rd AlE the Lltowirg h'b. Ststenmt! pepaE a co'lfun SiE Inod.Stlt€ft dd d* omenig

d ord.'d ldi'rtffi' €r*0, &tu.'d ti.!'nq E4.s

g.2O Anob*isofFinon inlstat n ntv)Ol

t. Cost of gpo& sold hN dcc.€ased ftoh 76% io 68jA There e t*o lossible reasns

. Emcicn! tunct'oniq of tha purchse dd pr.duction delEnnenit I.crease in tle ssle pri6 oi tbe p.oduc! siihout corcsponding in@a* in ilt

2. Incrcs in 8Is poit snd n€t ptuit i5 nqidJ due to dccEse in the % ol Cost of

nlustratior 1t. Rd€nue ald Eipetue daia fo. ihe tuft.t calendar v.& lor StdPaR! M lk Limikd and ror rhe Parr IndusrrvaF as tollNs Th€ Sld Poper MiDrLin'rcd dsb 6F dpEs'pd in Rup.eq. rhc psp€r rnduslrv stcrdc6 ale PrprsEod:n

(i) Prepar€ 6 connonaize incone slatemenl oDptnnA th. resulr!Sld Pepe. Mills Limii€d with $e induelrJ ave.aga.

(ii) & far d fhe d!t! permil, .oDsent on.l3!l6cani relaiio,d:i?,

dN U MOIE STI1EWXT OFSTAF PTPEN ILS ITiIIEO

t,rd sJ6- ccrd ,rdch$d $ s.s - &$ i0ErMe.-Gdril E:t M-odrEaer*l

a . - paronr Stutnut s ond fnn, no, SP€ Shtrr.rs

-j. above table relells tnat ptulil alter id ol the .onplDv is nore than the IndushvlredEe nr! rd5cFssonio' I 'r'c ' d"d"Jr'' rie e;!ns!s. feDPrs rnq haa'o"rdP(laldF""olo i Ser'asErp ncP

-ra"stE^p.nqd' Olq L*pa.e. 1J\dg!' p o^{1fror 13.6, .0 r6o.Common SEe Aal.nce Sheel: Connon Size Bala.ce Sheei depicts ihe percentagc relaiion of each assetliabiliiv; roial .sets/total li.biliiies including.apitd In Codmon Size Balancc Sheei iohl.-.d. or l,ab L €. ",e raLel a. l00 nd a'l "' lipJ s a'e eYpr"s"od - pe 11 as"i. t. ,nL,t co-oa'r"e -..on s) ba s" .h +, (ot d'""r"nr pq od l dp ro--h ,sht -he n.;ds a d'ficr"nr:r'r" II pJ pa'edrordfrl n ri'. nan-.'iry,, t..i.u*.-r'e" h nl"r ""o'1ons "'dl-tp.in 'ndP-Jald"s

Oblectiva ol Cnnhon SE Aalare Shetr To andyse the chsFes in individml iten of Balsn.e SheelI To s.o the trend ofdime.eni items ofassels and liabilities

Prepfttin ol codnon SiE Balatue Sh@t$nib Feparing ihe Connon Size Bslsnco Sheet we lal<e thc lollowt.s steps:

1 xDter the iiens ol Baloce sheoi in lirsi colunn2 Enter the absolute anounls ol ditrere.t iiens (asselsliabililies) ol p.€vious Jeals

Bstance Sheet in Secdnd Collnn sd curerl vesr items in Third Col]jln3. CaL'nrbmdcnt€rtnep€nent gerelatronoldifiofnlitemsofpsio$realsBslaln

She€t lo total liabilitieeiobr ssots, wnich re l.Ien s 100, i. Foumr Collm., c. '.dl-kmdentcr tneDeGr u-nlruorolcPs nri m.onlltr' )'"''BalsF

s.a m bd t--b-rine";tal s- '.. 'hrcl m al" ' d.00,n nlh'o 'mi

FOBMATOFCOiiMON SIZE BALANCE SIIEET

p) 15)

*al do you md.rstand by oonfron sizo linanoial stalemanr3?

Ilhst!.tion 19, the Balan.e Sheeis olstd Paints Linit d as on 313t Mdr.i, 2007and 2003 re Siven b€ld:

BANCE SHEi'IS

Anollsis of Financial Stuteneat*l\I I

Prepm rl-" .ommon Siz. aalanc. Sheet fron Lhe rollomg

:."tp atiu, Stalenens dn l Cn n

PFpar lhe Connon Size Balarce Sheets lor Sts ?aink Linit€d fo.200t and 2003

rd connent on the chances

til, 'ti-

NoL: The lbove presentation is an alternalive presen!.lion t prepa..lhe Conmon

Thcre are sone nrjor changes which have occuned in lhe soutes of firds durins iwoyedrs.Capiralssapercenia€Bolttlliabiliiiessas193%in2007lneitis319%inioos. Rcsewes snd surllus nas dedined lrom 1o ?c, io a% Ar a resnli, shueholderlnmrb have in@sed lion 3096 to 40% Ii nees ibai shd ol liabitties nd delinedliom ?Of? t 60?0. Wiihin liabniiies. shre ol secured loms hts inqe$ed f.om 7% io2?% but share ol us{utd loes md curent liabiliti€s md provisions hss declined

Aadlr.& of Fiazncirl Stdtnee-Xll

* s.sOo you agr6 whh rh. starem.nt thar Comp.div.lncome SrEtomcnls.nd Comhon Siue Srltemenrt

arvswens ro af ouesrorls

busin€rs enteDr* on diff..ent d

thatthc sareor2009 has n(.tsedas absolute data n tems ofmonevv.lue

3.3Forex.dpl€,.b6olut€d.n9eofRs-5c6€sinc@€in200920.or.5 in 2oc€.om6 to 25% (ia, s/2o xr00). it is kiown at absoruE data i.teds of percent'g..

3,. whei finii.iar statements a memmhon ba*(|e.,) a,€ known a3 ommon si2e financl.r sten€ntt.

.rysis bec.use the data b.ing an

.nr i8 a rlor ,f rinan.i dnaLvsis 'hh rbsolub rnounr d ps@oese @

obj.clivs or Purpos orcoD!.n

? To bow tne w€tuN3 Dd €oud

Pnft rd rrrs a.qnk[ d. CoDpaath. Baranoc sheet

'cotnpoatin Bdoe shat onr4ri' b that u.tj {thttmdat nE itot6, wp ol e4' !^d4 rneonn" ere hutuqt4e N dtlle@t doh.'

,Fout[a

A Cofra4iv. Eo6i and h$ aNouo.ndnc'rd')!NnkgefiumF

connon si4 sbco.n. b rhe $k

mno!bsctcab!Ndsal4j0lhs

B.lanc€ Sh€es, Compa.ativ.arc inl..Jnm analysis? Giv.

Czarc rt Stot2nz^koad ConnrnSize Stoknen^

Iry shod An$er rype Ou*llone

+cntI@advaDl4qdacoDps!

:Eiplain'inlrier'ihefte'iodolp!

stachdis? crye ,&o objedive or c

lD.Lh rw c, lee3tbfenb.r?od* 2m3)

C.np.dlve B.lane she*

roimariodgilenin

!q,4.qq

e .hry! h sn oba tuu! flu oe Fiod b ddher.lN.tfitttAtai:Es.so,utlItu cPl: cumt Ae tu,2,10,00711r,.r-!1e); Shae copilot: No

ctuta.: Retp rd sualus ns. 10,000 iw@.); sturd L@t: R'. t,6o,aao @KE@IUnaqnd L@n: R'. Loa,M na.@): crtu Lbbntul6R'2.@,oNIlM.)l

Pliye Lrd. $ d 3rd Msh, 2004 Dd 2009:

T Fdl!4lMftd*{.(4.)Ltu@Meedn€s

4 rbd .he roll4ing Brlane Shet or Flral

Ano ly s is o t F i no nc idl S t at e tu nt *Xl I

tc8sE Farist 1se7, ^kdifitd,crodrEirb'ld tu l

6S@ ILhl."..."' M"'"h'

^os "'d ,,'

. infomsdon dven i

a c!ft

lodGdwrBtlhffiad4

5J-p"* " c"*ts-ir". B"r-- sh*t dn' Dlt'ii TtldEe sor .he i,llovln*l

:,aArcriue Statetunb and Connon Siz Statenents

lP.rentoe? chag! dLd kftk t7 23t, cvn

.uF, n6sb 3@ I,.?dAst 5o%' Toill 60%l

s,!os!

t!&qg !,9q!9S

3,23 Andlt olFidutolstdin2,L nl

6c) rJ@ |

lr. convedth.lorrrodryinsmesbb !inhaconprbtiveln@m.Shbdentin.linlhelishtofthe odirioB in 2004, ideDd t[! ch8lF i! l{09:

l0 PnFr r Compeldvr Inome sbtdnt rom th.IolloFins drhi

11. F oo ths follo{ils bloma$D, l)4ft . co@!"tilv.I!@ne allbn.'li

. : itohrt Stotzntrt s nr.] conntatr Si:. S/,r.rtrr9

PrcelialsindsiRyourfunoc

offnaNElycaGendcdon3ctMchlesilcnbdq!hr ara\Eis d thsc honr and h$

ts. st E$n,a Fide Ddhi, 1N2, Mdined)

330 Anal]t& of Fi,anci,t sr.tMthnlr?. rJ.o rlE lollosiq info@tioi, F slmptisinoM5d,

ETEGfuaNAffi T@s

ftom orarisPioft Ndridmdrr l000 sq000 ,0n00 II

Irtoro Sbbr.nr io !{!q r.nltl

\cBsR 2A@Ciltwne. CtNe.: Stb 6.67q: cd 2F*:aw *otu anl

rndid EaPI{6 26c* ond oth{ 51.53 6rhl

:z,pamtite Stdtanent otd Cannaa size Stutu nents 3.31

lPen tose t(ra* 1D!q.dR: sat r saat c@t af&D,k sart 75%:I.ditut Eqenps 1o%| Nd Ptulit b.foE T4 35 a Nd

lAbd*d.q,1R,r

common size Balancg sh€sr

Andlr s al Finnttbt Stoftnenti NI2s, P.erICmmnStuB,L.e$id mdmmhqrm !h.Cn n rirFi6mdfxlin!i tlrd

The Bdlone sh..t orx Lt{ ald y L!d. a3 on 3 t 3r Manh, 2009 rF gicsn b.lN:

fc@Pbt'-F1?.o.oei& n dir. llora"rl*-*r.soo rmrs* |

L lldrMll's r&-F! 2.75no, {ll\orsar4 l!cmrunsirljllifusitu :

l'. tu the 6rld*in*d!h, rreIre ! Co|Ir!!@Sia ltldio s6bneDt