FINANCIAL STATEMENT ANALYSIS 6
Thefinancial strength ratio entails the liquidity or solvency of thecompany or the business in question. It seeks to identify thefinancial strength, position and its ability to be in operational inthe near future depending on the financial competence, to cater forthe daily expenses. It involves the financing cash flow which isexplained by dividend payment, short-term and long-term payments, andthe liquidity of the company. The management ratio is reflected inbranding, proper marketing strategies, innovation and organizationalstructure. All the stakeholders are devoted to the purpose, corevalues and vision of the organization which is shown by effectivefinancial reporting. The management is responsible for effectivesystem of internal control brought by integrity and being objective.Efficiency ratio, on the other hand, entails the company make use oftheir assets to generate income. It is the general sales of thecompany, and they are used by the management, financiers andcreditors in order to assess the profitability of the company (P&G,2014).
Inthe case of The Procter and Gamble Company, all these three aspectsare evident throughout this financial reporting. We can confidentlyidentify that the company has a strong financial base and effectivemanagement which has resulted to efficiency of the company. Frompages 37-44, the company has highlighted several aspects to provideclear recordings by analyzing the elements that defines the financialstrength. They have provided a well-detailed balance sheet recordsof assets, liabilities and its total company worth. Through theasset-liability relationship in the report, it is evident that thecompany is efficient and therefore painting a positive picture to themanagement and other stakeholders. The management of the company hasalso clearly indicated its objectives and commitment to releasepositive results. It has included an independent registeredaccounting firm to provide a detailed audited financial report whichis an indication of transparency and adhering to the law (P&G,2014).
P&G(2014). 2013Annual Report.Retrieved From: