FACULTY OF BUSINESS

ACCOUNTING SCHOOL

ACADEMIC REPORT

COURSE:

FINANCIAL ANALYSIS FOR DECISION – MAKING

AUTHOR :

Pinedo Vílchez María Olga

TEACHER :

César Augusto Pintado Castillo

Chiclayo - Peru

(2023)

1
 INDEX
COVER.……………………………………………………………………...1

INDEX.………………………………………………………………………………2

I. INTRODUCTION………………………………………………………….3

II. DEVELOPMENT…….………………………………………………...4

III. BIBLIOGRAPHICAL REFERENCES……………………………………9

IV. ANNEXES…….……………………………..……………………………...10

2
 I. INTRODUCTION
This academic report has been developed by a student of the sixth cycle of the
professional school of Accounting at the César Vallejo University at the
Chiclayo campus. The same one that was encouraged by the teacher in order
to learn more about this topic, which is why I will explain it in detail for easy
understanding.
Where the topic of Financial Statement Analysis will be addressed as well as
the Dupont Analysis topic and how these influence the development of cases.
In Peru, it is due to the globalization of organizations that
found in often changes and growth, where plans are projected for
be able to improve the sector of their entities and so that they can obtain a good
financial profitability, making good decisions and improving your situation
economical.
The analysis of financial statements is very important to see the
financial situations of the company, especially taking into account the issue
research.
According to Evelin León (2023), he Analysis is the decomposition of a whole
into parts to know each of the elements that make it up and then study the
effects that each one has.
Financial statement analysis is the critical process aimed at evaluating the
present and past financial position and results of operations of a company, with
the primary objective of establishing the best possible estimates and predictions
about future conditions and results.
For Guillermo Westreicher (2018), he mentions that Dupont analysis is an
important tool to identify whether the company is using its resources efficiently.
This methodology requires data on sales, net profit, assets and debt level.
The goal of the Dupont system is to find out how profits (or losses) are being
generated. In this way, the company will be able to recognize which factors are
supporting (or affecting) its activity.
II. DEVELOPMENT
II.1 . Financial statement analysis
This is an accounting method that evaluates the financial situation of a company
and, based on this, identifies measures favorable to the economic situation.

3
Financial analysis is generally used to evaluate the degree of stability,
profitability, solvency or liquidity. With this in mind, keep in mind that there are
two ways to analyze a company's finances.
Internal Analysis – Helps fund managers make future trading decisions. This
study also helps review historical trends of past successes.
External analysis: Allows external investors to know the financial status of the
company and future trends. Graduate School of Economics and Finance (2022)
II.2 . How to carry out a financial analysis?
According to Financial Reasoning (2023), a financial report is a document that
contains the financial data of a company. This includes the income statement,
cash flow statement, balance sheet, and other related documents. Financial
reports provide an overview of a company's financial position at a given point in
time.
Financial reports are prepared to provide owners, investors, regulators, and
other interested parties with a clear picture of a company's financial health. This
will help you make informed decisions about your business.
A typical example of a financial report includes the following documents:
• Income statement (also called income statement)
• Statement of cash flows
• Balance sheet
• Statement of changes in Equity
• Notes to the financial statements
In addition, the financial report includes an analysis and discussion of results.
This section describes the company's financial results during the reporting
period. This is useful for readers who want a deeper understanding of a
company's financial condition.
If you're wondering how to conduct a company accounting review, you need to
understand three key areas to effectively analyze financial statements: There
are a few things you need to know.
 Structure of the financial statements.
 Economic characteristics of the industry in which a company operates.
 Strategy followed by a company to differentiate itself from its competitors.

4
Finally, the financial report also includes a forward-looking section that provides
short-term and long-term outlook for the company. This section includes the
company's growth plans, marketing objectives, pricing strategies, investment
projects, financial risks, etc. This section helps investors and other interested
parties better understand the future of the company.
II.3 . Objectives of a financial analysis
According to Tamara Gasco (2019), the main objective of financial analysis is to
evaluate and analyze the situation of a company, company or association at a
particular time and formulate a diagnosis to derive conditions for actions that will
benefit future economic development.
Furthermore, another principle of financial analysis is to extract data external to
the company, that is, information about suppliers, investors or simply issues
related to state business policies and current legislation.
Therefore, among the tasks of financial analysis, questions relating to
profitability, debt, economic and financial conditions and investments are
fundamental. For this reason, administrators must have access to all relevant
data.
The types of financial analysis are diverse and not mutually exclusive. None
claim to be exhaustive or perfect. Several techniques provide analysts with the
information they need to obtain an overview of an organization's financial
health.
To obtain solid information about the financial situation and management of a
company, at least a balance sheet and a profit and loss account are necessary.
We recommend obtaining financial statements from previous years as this
allows you to use more and different types of analysis.
II. 4 . Types of financial analysis
For Acosta Altamirano (2022), the types of financial analysis are diverse and
not mutually exclusive. None claim to be exhaustive or perfect. Several
techniques provide analysts with the information they need to obtain an
overview of an organization's financial health.
To obtain good information about the financial situation and management of a
company, you need at least a balance sheet (balance sheet) and an income
statement. We recommend obtaining financial statements from previous years
as this allows you to use more and different types of analysis.

5
Acosta Altamirano classifies types of financial analysis into:
 Vertical analysis method
 Horizontal analysis method
 Historical analysis method
II.5. - Dupont analysis Case development.
According to Guillermo Westreicher (2018), he defines that DuPont analysis is
an important tool to determine if a company is using its resources efficiently.
Additionally, this method requires data on sales, net income, assets, and debt
levels.
II.6 . Objective of Dupont Analysis.
The goal of the Dupont system is to discover how profits (or losses) are
generated. This allows companies to identify which factors support (or
influence) their operations.
II.7 . Elements of Dupont analysis
The elements of Dupont analysis are the following:
 Net margin
 Asset turnover
 Capital Multiplier
II.7 . Usefulness of Dupont analysis
In the same way, Guillermo Westreicher (2018) tells us that the main benefit of
DuPont analysis is that it allows decisions to be made to increase financial
profitability. To achieve this goal, it is important for companies to identify areas
where they need to improve their operations.
DuPont's analysis of a company gives insight into the company's performance
over time when historical data is considered. In addition, you can simulate the
effects of certain actions in different scenarios.
II.8 . ADVANTAGES OF DUPONT ANALYSIS
Jordi Altimira , (2019), mentions one of the great benefits of breaking down
DuPont's ROE is that it allows us to identify the "drivers" of profitability and track
their development over time. In this way, we examine how profits (or losses)
occur and identify the causes of declining profitability. This allows you to take
timely corrective actions and improve financial profitability.

6
As is known, this is one of the most useful financial tools to know what makes a
company profitable and if it is efficient. This department allows you to make
decisions that bring you closer to the objective of increasing profitability.

III. BIBLIOGRAPHIC REFERENCES

Leon Evelyn. (2023, March 23). Analysis of financial statements .
Retrieved from https://www.gestiopolis.com/analisis-de-estados-
financieros/ _ _ _ _ _
Guillermo Westreicher, October 8, 2018
Dupont Analysis . Economipedia.com
Graduate School of Economics and Finance (2022, May 11). How to do
the financial analysis of a company.
https://postgradoeconomia.com/como-hacer-analisis-financiero-empresa/
Financial Reasoning (2023), How to prepare a financial statement.
https://razonamientofinanciero.com/como-elaborar-un-estado-financiero/?
expand_article=1
Tamara Gasco (2019, January 22). Definition of financial analysis.
https://www.economiasimple.net/glosario/analisis-financieros
GestioPolis.com Expert, (2022, June 28). What types of financial analysis
exist? Recovered from https://www.gestiopolis.com/que-tipos-de-analisis-
financiero-existen/
Guillermo Westreicher (2018, October 8). Dupont analysis.
https://economipedia.com/definiciones/analisis-dupont.html
Jordi Altimira , (2019), How to do a dupont analysis of a company ?
https://www.upbizor.com/estrategia-financiera/analisis-dupont-de-una-empresa

7
IV. ATTACHMENTS (To match )