Success in the business world requires participants to have a good understanding of how companies perform. This is made possible by examining the various ratios based on the financial statements....

Success in the business world requires participants to have a good understanding of how companies perform. This is made possible by examining the various ratios based on the financial statements. Whereas the ability to calculate ratios is important, the real value of ratios lies in the insight that can be gleaned from them. Therefore, the most important aspect – as well as the goal – of this assessment is the interpretation of ratios.

Students are required to produce a 1,500 word paper (font-size 12 and line spacing of 1.5) to analyse a company of their own choosing, using ratios generated based on financial statements of a firm, as well as reports on the chosen company’s recent business performance, strategic decisions and financing decisions. One of the challenges of this assignment is that usually in financial statements there will be alotof details that can be very accounting-wise technical. One way to get around this is to aggregate the details into major categories (e.g. if there are different types of interest expenses, just add them all up to form one single “interest expense”). The idea is to take a step back and focus on the big picture instead of getting bogged down by unnecessary data.