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Why are trend analysis and industry comparison important to financial ratio analysis?

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Question added by Divyesh Patel , Assistant Professional Officer- Treasury , City Of Cape Town
Date Posted: 2014/04/06
Mohamed Nabil Alsaid  Osman
by Mohamed Nabil Alsaid Osman , Accounting Manager , Rawaa Hospitality for Contracting Co

The Ratio and Trend analysis Can Evaluate the performance of the established end of the year and is one of the tools used in the control disclosure of strengths and weaknesses and analyze the financial situation of the business and comparison with competitors.

SREEDEVI SUNILKUMAR
by SREEDEVI SUNILKUMAR , Business finance officer , Emirates Airline

 

Trend analysis helps financial managers and analysts see whether a company's current financial situation is improving or deteriorating.Cross-sectional analysis, or industry comparison, allows analysts to put the value of a firm's ratios in the context of its industry

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