Scientific journal NRU ITMO
Series "Economics and Environmental Management"
Registration certificate ЭЛ № ФС 77 – 55411 от 17.09.2013
registered by the Federal Inspectorate Service for Communication, Information Technologies and Communication Media

2014 (published: 16.03.2014)

Number 1(16)

Home > Issue > To the study of financial analysis with the use of cash flow ratios

UDC 336.64

To the study of financial analysis with the use of cash flow ratios

Laskina L.Y., Klimova M.L.

Financial characteristics are used by various parties in interest for making balanced management and investment decisions about business entities. Financial analysis plays an essential role in evaluating company’s financial position. Ratio analysis is one of the methods for assessing company’s financial condition. The article presents modern problems of evaluation of company’s financial solvency with the use of traditional liquidity ratios. Alternative technique based on ratios that focuses on company’s cash flow is suggested. The advantages of using cash flow ratios are shown up. The comparison between traditional ratios and cash flow ratios is given (through the example of companies from Australian telecommunications sector). The particular focus of the article is on financial statements information which is of great importance for making balanced conclusion of company’s financial solvency using ratio analysis.
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Keywords:  ratios analysis, liquidity, financial ratios values, statement of cash flows, cash flow ratio.

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