Financial analysis:

Financial analysis (also defined to as financial statement analysis or accounting analysis or Analysis of finance) defines to an assessment of the viability, profitability and stability of a business, sub-business or project.

It is done by professionals who prepare reports using ratios that make use of data taken from financial statements and other reports. These reports are generally presented to top management as one of their bases in making business decisions.

Discontinue and continue its main operation or part of its business;

Make or purchase certain stuffs in the manufacture of its product;

Acquire or rent/lease definite machineries and equipment in the production of its goods;

Issue stocks or negotiate for a bank loan to increase its working capital;

Make decisions regarding investing or lending capital;