The paper “ Financial Resource Management - Accounting Systems” is a comprehensive example of a business assignment. Business corporations and entities execute their business plans for the achievement of financial targets within a specific period generally in a business year through the utilization of resources to enhance the image of the company in the external business environment. Financial results as reflected in the annual financial statements and reports along with management discussion and analysis serve as an indicator for the evaluation of the financial results and their comparison with other similar business companies.
Financial ratios are tools for the interpretation of financial statements to provide a basis for valuing securities for the appraisal of financial results and management performance of the business companies. The designing and building of financial ratio calculations gives a mechanism for the financial modeling exercise for the company under consideration and enables robust analysis through the financial results. Four types of financial ratios which include performance ratios, working capital ratios, liquidity ratios, and solvency ratios help in the evaluation and analysis of the business corporations. The financial ratios for the two companies that are Higginson Chemicals Plc and Henry Group Plc for the year 2011 and its comparison with the year 2010 will provide sufficient data for the formulation of results and conclusions, the same will be helpful in revising the business strategies for the achievement of better financial results in the subsequent periods.
(a) Prepare financial ratios for both years: The financial results of company one Higginson Chemicals Plc, a manufacturer of pharmaceutical products have shown significant performance in the year 2011 as compared to that of the year 2010 assets of the company both non-current assets and current assets have shown an increase as 5% increase and 46.01% increase, respectively.
Equity and liabilities have also demonstrated an increase of 24.81% increase from the year 2010 to the year 2011 which
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