Hi,
I am working as an accountant, and part of my job involves financial analysis.
Here is the situation:
My company is a governmental institute, that provides a license for different companies in the manufacturing field.
There are 7 main categories in the market, so we are issuing 7 main licenses.
There are 96 companies in the market, and all of them already got a license from us.
Each year, each company sends us its 3 main financial statements (balance sheet, income, and cash flow).
For each company, we do horizontal, vertical, and standard ratios analysis "profitability ...etc".
Till now everything is fine.
I've been assigned a new task, to compare all companies together to determine which company is better regarding performance ...etc.
So I've calculated the main items in the 3 financial statements like current assets, current liabilities... etc. from the balance sheet. and did the same with income statements, like sales, cogs, gross profit... etc,. and the same with the cash flow like cash from operation ...etc.
So my strategy was to use only the numbers that represent a result of a main item in the statement.
Also I calculated all ratios, prepared everything in a report, and gave it to my manager.
The new task is regarding the detailed items in the statements, meaning that my manager asked me if we are comparing the FixedAssets item from all companies, is it the same container? and when I searched I found that some companies reported net fixed asset, others reported total fixed assets, and other included under conistructions assets under fixed assets.
So, my question is, is if I would like to unify or consolidate, or combine items inside different statements so that it is as like as possible, what is the name of that thing? and what is the right way to do it?
Is it a reclassification?
Please help.
I am working as an accountant, and part of my job involves financial analysis.
Here is the situation:
My company is a governmental institute, that provides a license for different companies in the manufacturing field.
There are 7 main categories in the market, so we are issuing 7 main licenses.
There are 96 companies in the market, and all of them already got a license from us.
Each year, each company sends us its 3 main financial statements (balance sheet, income, and cash flow).
For each company, we do horizontal, vertical, and standard ratios analysis "profitability ...etc".
Till now everything is fine.
I've been assigned a new task, to compare all companies together to determine which company is better regarding performance ...etc.
So I've calculated the main items in the 3 financial statements like current assets, current liabilities... etc. from the balance sheet. and did the same with income statements, like sales, cogs, gross profit... etc,. and the same with the cash flow like cash from operation ...etc.
So my strategy was to use only the numbers that represent a result of a main item in the statement.
Also I calculated all ratios, prepared everything in a report, and gave it to my manager.
The new task is regarding the detailed items in the statements, meaning that my manager asked me if we are comparing the FixedAssets item from all companies, is it the same container? and when I searched I found that some companies reported net fixed asset, others reported total fixed assets, and other included under conistructions assets under fixed assets.
So, my question is, is if I would like to unify or consolidate, or combine items inside different statements so that it is as like as possible, what is the name of that thing? and what is the right way to do it?
Is it a reclassification?
Please help.
