INTERNATIONAL FINANCIAL STATEMENT ANALYSIS

INTERNATIONAL FINANCIAL STATEMENT ANALYSIS

Differences in form and content of financial statements

The form and content of financial statements has been no uniformity among industrial companies and trade, so the classification of the accounts of a company will vary with other companies. This difference might be due to:

1.      The report is tailored to the pressure or the use of management objectives or purpose of the report.

2.      Differences of opinion among those who compiled the report.

3.  Differences in knowledge and experience than the accountant who prepared the report.

4.      The failure to put to use titles or new classifications commonly accepted or commonly used.

Measures analysis of accounting

1.      Know the Company

2.      Mastering the Economic Situation

3.      Assessing the Reliability of Financial Statements

4.      Assessing the Accuracy of Financial Statements

5.      Reading Financial Reports Information by Explicit

6.      Analyze the relationship between post-LK Reveals Implicit Information

7.      Looking at trends / Growth

8.      Doing Comparative Analysis

9.      Assess the composition of Cash Flows

10.  Facts and conduct evaluation of the Company Quality Analysis Results

11.  Perform predictions or projections

12.  Conclusions and Recommendations

Accounting analysis of the influence of inter-state accounting

Analysts need to evaluate policies and accounting estimates, and analyze the nature and scope of a company's accounting flexibility. Effect on the measurement of quality of accounting, and auditing are very dramatic.

International accounting difficulties obtaining information

In obtaining the data of International Accounting, there are several difficulties, among others :

1.      depreciation adjustment

Depreciation will affect profits, it is necessary to consider the age of the functions that must be decided asset management.

2.      LIFO to FIFO inventory adjustment

Inventories should be converted into the FIFO method

3.      Reserve

Reserves are the company's ability to pay or cover expenses for removing the load.

4.      Reformulation of Financial Statements

Adjustment of some of the changes after a few calculations on the points above TSB.

Mechanisms to resolve differences between countries accounting principles

Differences between countries with the quality of accounting measurement, disclosure and audit are very dramatic. National characteristics that cause these differences include the required practices and generally accepted, monitoring and enforcement, and the scope of management discretion over financial reporting.

Some of the approaches used by the users of financial statements to address the cross-country differences in accounting principles. Some analysts present the foreign accounting resize according to a group of internationally recognized principles, or in accordance with the fundamental group of internationally recognized principles, or in accordance with a more general basis. Some others develop a complete understanding of accounting practices in a particular group of countries and limited their analysis to firms located in those countries.

Difficulties and weaknesses of international financial statement analysis

1.      access to information

Information about thousands of companies from around the world have been widely available in recent years. Sources of information in countless numbers up through the World Wide Web (WWW). Companies in the world today have a website and annual report are available for free of charge from various other sources.

2.      Timeliness of information

Timeliness of financial statements, annual reports, reports to regulators vary in each country.

3.      Barriers of language and terminology.

4.      Foreign currency issues.

5.      Differences in the type and format of financial statements.

Use of website / www to obtain research information company

Some characteristics of the Internet is relevant to financial reporting. As a communication medium, the Internet affects the communicative aspects of financial reporting, such as: access, distribution, interaction, and presentation and the presentation (Xiao et al: 2002).

1.      And the easier access and global distribution

2.   World Wide Web features such as hypertext, hyperlinks present a potential to change the way the presentation of financial statements, financial information will be linked directly with non-financial information (Xiao et al: 2002).

3.      Communication of financial information to stakeholders can be done interactively.

Source :

http://anitasimarmata.blogspot.com/2011/06/analisa-laporan-keuangan-internasional.html
http://andamifardela.wordpress.com/2011/05/18/analisa-laporan-keuangan-internasional/