Evaluation of Financial Performance of Pharmaceutical Industry in Bangladesh with Special Reference to Square Pharmaceuticals Ltd

Mahfuj Ullah A.K.m and Md. Zakir Hossain
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Mahfuj Ullah A.K.m: Lecturer (Accounting and Information Systems), Department of Business Administration, Rajshahi Science & Technology University (RSTU), Natore, Bangladesh
Md. Zakir Hossain: Professor, Department of Accounting and Information Systems, Islamic University, Kushtia, Bangladesh

International Journal of Science and Business, 2021, vol. 5, issue 2, 1-16

Abstract: No doubt financial performance analysis is a subjective & fundamental tool to discover the proficiency of the management in various parts of an organization. Evaluation of financial performance through analyzing the financial statement using financial ratios is usually related to how well an organization is using its revenue, expenses, assets as well as equity and liabilities which shows the picture of the financial position of that organization. Solvency (liquidity), profitability, turnover and return on assets (ROA) and return on equity (ROE) have been analyzed to interpret & measure the efficiency of management, financial performance and position of Square Pharmaceuticals Ltd. (SPL). The nature of the study is empirical based on secondary data that have been collected from annual reports of SPL (2012-2019). Pharmaceutical is a significant aide of industrialization in the nation. Having a significant contribution (1.83%) of pharmaceutical industry to our GDP with a growth rate (15%) sound financial performance of pharmaceutical industry may be useful for getting ready financial and monetary policy of the nation. From the finding of the study, it is revealed that profitability, inventory & accounts receivable turnover, assets turnover, financial leverage, ROA & ROE are doing well but liquidity position is not so much satisfactory and assets turnover ratio requires more concentration on it cause of a mixed trend. From overall findings, it is supposed that the management of SPL has been able to keep stability in running the business affairs and bring upward trend in generating earnings. The study draws the attention of the proper authority through some recommendations like keeping up a compelling coordination among different departments particularly in the finance, sales and PPIC department for further improvement of SPL.

Keywords: Pharmaceutical Industry; SPL; Financial Performance & Position; Liquidity; Profitability; Assets-Inventory-Accounts Receivable Turnover Ratio; ROA; ROE; Equity Multiplier (search for similar items in EconPapers)
Date: 2021
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