\"Financial Analyst Skills\" Please respond to the following: Based on the infor
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Question
"Financial Analyst Skills" Please respond to the following:
Based on the information presented in the e-Activity, recommend the skills that are required to be a successful Financial Analyst, indicating how the role of a Financial Analyst adds value to a company. Provide support for your answer.
Assess the key ratios used by Financial Analyst to evaluate the financial performance of company, indicating the ratio that you believe to be most indicative of future performance. Provide support for your rationale.
"Financial Analysis" Please respond to the following:
Determine three key ratios that should be used when evaluating the financial performance of a company, indicating what information this will reveal to an analyst and the impact to decisions made about the company.
Given that financial analysis is reactive based on events that have already occurred, suggest how financial analysis may obtain information to be proactive to the decision-making process. Provide support for your rationale.
Explanation / Answer
skills and role that are required to be a successful Financial analyst are:
1. Understand the concept of materiality. Good financial analysts can draw conclusions with incomplete information and have a feel--an educated gut feel, perhaps--for when information is relevant and when it isn't. In some cases the information is measurable, like the dollar magnitude of a transaction or the level of a variance percentage to budget.
2.Are good at using spreadsheets and databases to analyze information. Good financial analysts know how to apply the tools available in spreadsheets and databases to pull together disparate data, solve problems, and present information to management.
3.Understand management accounting concepts and apply them to their business. We all learned many valuable concepts in our undergraduate and MBA courses, but most financial analysts don't utilize them fully in their jobs. For example, analysts responsible for departmental budgets are skilled at using variance analyses and activity-based costing (ABC) techniques.
Profitability ratios measure a company
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