Annual Reports with Calculations Assignment Example | Topics and Well Written Essays - 1250 words

Annual Reports with Calculations - Assignment ExampleVarious classes of fiscal ratios are analysed establish on financial statements of the system provided in its annual reports of 2012 and 2013. These annual reports cover the financial performance of the organisation for 2011, 2012 and 2013. The classes of financial ratios analysed in this report include liquidity ratios, solvency ratios and profitability ratios.Liquidity ratios are used to pulse the ability of the organisation to meet its pitiful term debt obligations as they fall due. One of the liquidity ratios is the bustling ratio. This ratio measures the ability of the firm to pay its current assets victimisation its more liquid current assets (Ryan, 2004). From the financial ratios calculate, the quick ratios of Woolworths Ltd were 0.29, 0.31 and 0.32 in 2013, 2012 and 2011 respectively. This means that Woolworths could pay for its current liabilities 0.29 times, 0.31 times and 0.32 times in 2013, 2012 and 2011 respectiv ely out front its more liquid assets are exhausted. Therefore, the company was able to meet its current short term liabilities use its more liquid assets in 2011 and 2012 more than 2013. The ability of the organisation to meet its short term debt obligations use more liquid assets reduced over the three years under analysis. The company needs to worry its more liquid assets more effectively to improve its liquidity so that it can meet its short term financial obligations as they fall due.The second type of liquidity ratio used in this analysis is the current ratio. This ratio measures the ability of the organisation to meet its short term financial obligations employ current assets as they fall due. It indicates the number of times current liabilities can be paid using current assets before the current assets are exhausted (Gibson, 2012). In 2013, the current ratio of Woolworths was 0.91 while in 2012 and 2011 the ratio was 0.86 and