How can financial ratios be used to assess a company's performance?
Financial analysis is regarded as one of the essential tools in business and a foundation for planning and control. Financial ratio analysis is a fundamental tool for analyzing a project's financial position in light of the figures and data in its financial statements. It is used by investment firms, banks, and knowledgeable business owners to learn more about a company's current financial health, potential, and challenges. In general, small and medium-sized businesses struggle to analyze and improve financial ratios. In the end, it's all about data, insights, and analysis. After performing due diligence, which entails a thorough investigation of the borrower's background and financial history, financial institutions assign a credit score to them. They use various ratios in credit analysis, and the choice is based on the borrower's objectives and the projects in which they intend to invest capital. Qualitative and quantitative methods are used in the credit analys...