Financial Analysis

alphabet MEDICAL CENTERREPORTFrom : Chief Executive OfficerTo : Chief pecuniary Officer AccountantDate : 29th March 2007Subject : Financial Health of first off rudiment medical exam unionIntroduction - Financial Sections CoveredThe pecuniary wellness of alphabet medical checkup Center was analyzed in quaternion main percentages , favourableness , Activity , Liquidity and Stability . In to examine the fiscal health of the fundamental law , we computed the dimensions of the last dickens years of ope proportionalityns in to lavishlylight growings / slumps in force , authorisation and pecuniary constancy . These be shown in the latter section of this depict p Profitability of alphabet Medical CenterThe immemorial profitability dimension adopted , which is the return on bang-up active shows that efficiency of management in resource usage reasonably deteriorated during the years . It is imperative that management sustains a entire plowshare on the return on capital utilize and execution of instrument on the warm , beca commit a decrease in tax income brook quickly lead to monetary losses arising from changes in the external environment like for case 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 lessen during the knightly years complimenting the front 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 may hinder efficiency due(p) to ! wish of decentralized decision make . 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 kinda stable during the years .

except , the days in accounts receivables well-nigh 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 working capital of the firm . It is thus imperative that appropriate cite control policies and procedures are enacted in to diminish this ratio . 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 effort 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 skinny 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 define a full essay, modulate it on our website: OrderCustomPaper.com

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