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Accounting Ratios 5

Financial statements aim at providing financialinformation about a business enterprise to meetthe information needs of the statements prepared by a businessenterprise in the corporate sector are published andare available to the decision-makers. Thesestatements provide financial data which requireanalysis, comparison and interpretation for takingdecision by the external as well as internal users ofaccounting information. This act is termed asfinancial statement analysis. It is regarded as anintegral and important part of Accounting .

liquidity, efficiency and ... because accounting records ignore changes in value of money. 3. Ignore Qualitative or Non-monetary Aspects: Accounting provides information about quantitative (or monetary) aspects of business. Hence, the ratios also reflect only the …

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