Need help regarding Bal. Sheet analysis (Vertical and Horizontal)

[PaklovesTurkiye]

Hello guys, i need help regarding analysis of Balance sheet (vertical analysis and horizontal analysis), please elaborate in detail how so far company is comparatively in 2014 and 2015. Good/progressing or suffering loss, what does it mean/imply by decreasing non current liabilities? company profitable or not? what does it mean if 78% of finances are covered by equity (like in this case)? Step by step elaboration of both analysis will be very helpful.......THANKS.

 

[PaklovesTurkiye]

Well, i am unable to upload data, don't know whats wrong, i urge moderators to close the thread.

 

[redgriffin]

Well Horizontal analysis is a comparison of like figures for two years eg Sales yr2 vs Sales yr1. Vertical analysis is between data for a single financial year/period eg Net Profit as a % of sales, liquidity ratio calculation (though comparing with previous year would make it horizontal), expense as % of sales etc etc. The 78% of the statement means 78% of the finances come from ownwr's equity or capital which depending upon an entity's legal status can be owner's money or share holder's money with the rest 22% being funded by long-term financing/liabilities.