How to Monitor Performance Through Critical Financial Ratios

Dimitris N. Chorafas

Chapter 13 in Financial Models and Simulation, 1995, pp 275-298 from Palgrave Macmillan

Abstract: Abstract Financial analysts and investors have often been too simplistic in their views of income statements. This is particularly true with comments of the type: ‘Revenues grew 20 percent,’ or ‘Expenses have been reduced by 7 percent.’ Such pronouncements are not only vague but also misleading because they are often made in isolation: It is not possible to judge the health of a company: Without reference to what is going on in the rest of the P&L statement, by line and in a consolidated sense, and/or With no comprehensive notion on how the change in individual line items fits with the management’s overall strategic plan.

Keywords: Cash Flow; Discount Cash Flow; Service Charge; Discount Cash Flow; Money Center Bank (search for similar items in EconPapers)
Date: 1995
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DOI: 10.1057/9780230374836_13

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