Financial Performance Assignment Example | Topics and Well Written Essays - 3000 words

Financial Performance - Assignment ExampleIt is an important prick of the companies annual report, which contains acknowledgement from the external auditors that the companys accounts and financial statements reported present a true and fair view of the companys affairs. This satisfies the government about the accuracy of financial packing presented in the Tesco and Sainsburys financial statements.This section represents the financial effect of both the companies for the current year and also the forward year. This section helps the investors, lenders, employees and general public to compare the companies income and depreciate stipulation of the current year against the previous year and predict the future of the company.This reveals the companies financial position for the current year-end. It shows the companies asset and equity position for the current and previous year. This contains the information on companies liquidity, solvency, efficiency and investment prospects. Thi s is helpful for investors, lenders, suppliers, employees, customers and general public.This section reveals the companies position in terms of availability of cash and shows the cash inflow and spring for the current and previous years. Again, this section is very important for various stakeholders of the company.The run and Financial Review (OFR) statement of both the companie... This section contains information necessary to read between the lines of financial statements. This section is very important for a true and complete analysis of the companies financial statements.THE OPERATING AND FINANCIAL REVIEW (OFR) STATEMENTThe Operating and Financial Review (OFR) statement of both the companies show the summary of the companies financial statements, their financial performance, their segmented financial results and the profitability of the companies reflecting their financial statements. Both the companies have provided a thorough analysis of their companys major operations and r esults obtained from these operations. The statement also emphasises the major risks faced by the company, which enables a reader to get an insight of the companies present condition and evaluate any future risks.TESCO PLC-- RATIO ANALYSISThe financial performance and position of Tesco Plc can be assessed with the help of ratio analysis for the last tercet years. This analysis is broken down into sections so as to be helpful for all the groups interested in the financial performance of the company i.e., the focal point, the investors, the lenders, the analysts etc. surgical processThe performance of Tesco Plc over the last three years can be assessed by the following ratioReturn on Investment (ROI)20052004200314.95%14.04%13.85%The Return on Investment ratio is used to analyse a companys position in terms of the return or profit it gains on the funds invested. It shows the effectiveness and performance of the companys management to obtain more returns on the companys investment. Te sco Ltds Return on Investment ratio has almost been stable over the last three years, showing that the companys management has been utilising its