Analysis uses and limitations

Analysis uses and limitations

Bachelor of Business Studies (BBS) — Second Year

Subject: Fundamentals of Financial Management (MGT 215)

Unit 2: Financial Statement Analysis

Academic Year: 2083/84

Topic Objectives

After studying this topic, students should be able to:

• Explain the scope and key elements of analysis uses and limitations.
• Apply the relevant financial model, calculation or analytical approach and explain its assumptions and decision implications.

Curriculum Scope

• Uses and limitations of financial ratios
• Common-size and index analysis

Detailed Microsyllabus

1. Uses and limitations

   1. Performance, credit and operating analysis.
   2. Seasonality, accounting choices and unusual items.
   3. Need for context and multiple measures.

2. Common-size and index methods

   1. Express items relative to a common statement base.
   2. Use a reference period for indexed trends.
   3. Interpret composition and changes with consistent definitions.

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Curriculum reference: Tribhuvan University, Faculty of Management, revised four-year BBS curriculum, PDF pages 41-43.

Source note: The curriculum scope above is retained from the existing TU syllabus breakdown. The numbered study subtopics are editorial elaborations for teaching and study, rather than a separately issued TU syllabus. Unit or component allocations apply at their stated level; no separate topic hours or marks are assigned here.