How to read Balance sheet

This query is : Resolved

rajesh kumar (Querist)
Follow

08 July 2010 How to interpret the Balance Sheet figures of a Company from the point of view of:

1. to Invest in the shares of the company
2. to understand the financial status of the Company

CA.Mini

CA.Mini (Expert)
Follow

08 July 2010 to invest in the shares of the company see its P/E ratio which is available on the face of the financial statements.the lower the p/e ratio it is worthwhile.to understand the financial status go through its EPS .,networth, capital gearing, debt-equity ratio and dscr.this will in short give u a glimpse of the company.

rajesh kumar

rajesh kumar (Querist)
Follow

12 July 2010 Thank you. How can we use the cash flow of the company for the same purpose.

CA.Mini

CA.Mini (Expert)
Follow

12 July 2010 cash flow statement is the reality.it provides a window to peek into the real stand of the company. we can study the actual cash receipts ,annual cash commitments ,working capital cycle.of the company from cash flow statement.

rajesh kumar

rajesh kumar (Querist)
Follow

15 July 2010 Thank you

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok