ABC Corp's ROE has been decreasing over the last five years. How can you use financial statements
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Question:
ABC Corp's ROE has been decreasing over the last five years. How can you use financial statements to find the reason why?
The reason for a change in performance is almost always revealed in financial statement numbers.
The historic performance of a company is the best place to find a reason.
Use recent financial ratios because they will usually provide the reason.
Use the statements to find trends, but keep in mind there is usually not a single reason.
Related Book For
Financial Reporting Financial Statement Analysis and Valuation
ISBN: 978-0324302950
6th edition
Authors: Clyde P. Stickney
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