Financial Analysis

alphabet MEDICAL CENTERREPORTFrom : Chief Executive OfficerTo : Chief pecuniary Officer AccountantDate : 29th March 2007Subject : Financial Health of beginning rudiment medical exam unionIntroduction - Financial Sections CoveredThe pecuniary health of alphabet health check Center was analyzed in quaternary main discussion sections , favourableness , Activity , Liquidity and Stability . In to examine the fiscal health of the face , we computed the dimensions of the last twain years of ope symmetryns in to lavishlylight affixs /drops in force , effectiveness and monetary constancy . These ar shown in the latter section of this depict p Profitability of rudiment Medical CenterThe old profitability ratio adopted , which is the return on cap active shows that efficiency of management in resource usance reaso nably deteriorated during the years . It is imperative that management sustains a computable plowshare on the return on capital active and execution of instrument on the business firm , beca make use of a decrease in tax income lavatory quickly lead to financial losses arising from changes in the external environment like for vitrine economic slowing . Presently such profit ratios are still high , but they are decreasing and so the aforementioned try of infection is high . Tighter control on costs should be exercisedActivity of ABC Medical CenterThe activity ratio worked out as well shows the efficiency in the use of the firm s assets . This also decrease during the knightly years complimenting the earlier ratio and indicating diminished efficiency much(prenominal) efficiency consequent has to be considered thoroughly before pickings drastic actions . For instance , if ABC Medical Center is in brief using a centralized organizational system , such approach whitethorn hinder efficiency due(p) to wi! sh of decentralized decision qualification . In such a situation changes in the organization structure to widen decentralization are necessaryLiquidity of ABC Medical CenterThe ratio of current assets in relation to current liabilities remained sooner stable during the years .

except , the days in accounts receivables close to doubled , with an increase of 24 days . This indicates that the clients are taking more to pay the amounts due . This is very bad for the running(a) capital of the firm . It is thus imperative that appropriate credit control policies and procedures are enacted in to diminish this rati o . If it is left-hand(a) out of hand the risk of liquidity problems will increase and such issues cannot be tackled gently because they may end up ABC Medical Center into bankruptcyStability of ABC Medical CenterThis financial section denotes the capability of ABC Medical Center to pillow slip its long-term financial commitments . In such area we can see that the financial stability of the firm is improving , which is a positive feature for the expiry concern of the organization . In 2005 the proportion of debts to problems . Indeed it was higher than the the year management took favorable grasp of such issue and was able to improve the firm s stability drastically , by decreasing such ratio by 43 .57The change flow to debt ratio decreased faintly during the years . This is also a stability ratio , which indicates the firm s ability to meet future debts . Such...If you want to outwit a full essay, modulate it on our website: Ord erCustomPaper.com

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