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    Financial Management Slides 3.3

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    honathapyar
    This document provides an example of percentage change analysis for the income statement and balance sheet of Nestle Pakistan. For the income statement, percentage changes are calculated for revenue, costs, expenses and profits from 2019 to 2018. Revenue decreased 3.93% while costs increased 0.89% and expenses decreased between 6.2% to 25.17%, resulting in profits decreasing between 36.11% to 37.24%. For the balance sheet, percentage changes are shown for asset and liability accounts from 2019 to 2018. Key assets such as property decreased 0.1% while current assets decreased between 4.24% to 57.25%. Liabilities such as long term financing decreased 58.3% while current liabilities

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    Financial Management Slides 3.3

    Uploaded by

    honathapyar
    13 views7 pages
    This document provides an example of percentage change analysis for the income statement and balance sheet of Nestle Pakistan. For the income statement, percentage changes are calculated for revenue, costs, expenses and profits from 2019 to 2018. Revenue decreased 3.93% while costs increased 0.89% and expenses decreased between 6.2% to 25.17%, resulting in profits decreasing between 36.11% to 37.24%. For the balance sheet, percentage changes are shown for asset and liability accounts from 2019 to 2018. Key assets such as property decreased 0.1% while current assets decreased between 4.24% to 57.25%. Liabilities such as long term financing decreased 58.3% while current liabilities

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    Financial Management Lecture Slides

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    This document provides an example of percentage change analysis for the income statement and balance sheet of Nestle Pakistan. For the income statement, percentage changes are calculated for revenue, costs, expenses and profits from 2019 to 2018. Revenue decreased 3.93% while costs increased 0.89% and expenses decreased between 6.2% to 25.17%, resulting in profits decreasing between 36.11% to 37.24%. For the balance sheet, percentage changes are shown for asset and liability accounts from 2019 to 2018. Key assets such as property decreased 0.1% while current assets decreased between 4.24% to 57.25%. Liabilities such as long term financing decreased 58.3% while current liabilities

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    © All Rights Reserved
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    13 views7 pages

    Financial Management Slides 3.3

    Uploaded by

    honathapyar
    This document provides an example of percentage change analysis for the income statement and balance sheet of Nestle Pakistan. For the income statement, percentage changes are calculated for revenue, costs, expenses and profits from 2019 to 2018. Revenue decreased 3.93% while costs increased 0.89% and expenses decreased between 6.2% to 25.17%, resulting in profits decreasing between 36.11% to 37.24%. For the balance sheet, percentage changes are shown for asset and liability accounts from 2019 to 2018. Key assets such as property decreased 0.1% while current assets decreased between 4.24% to 57.25%. Liabilities such as long term financing decreased 58.3% while current liabilities

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    of 7

    Financial Statement Analysis

    Zoom Session 3
    Reference:
    Chapter 4 of Brigham, E.F. and Housto
    n, J.F., 2015. 13th Edition. Fundamenta
    ls of financial management. Cengage

    Chapter 4 Ehrhardt, M. C., & Brigham,


    E. F. (2011). Financial management: th
    eory and practice. South-Western Ceng
    age Learning.
    Percentage Change Analysis
    In this type of analysis, growth rates are calculated for all
    income statement items and balance sheet accounts.

    𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑌𝑒𝑎𝑟 𝐹𝑖𝑔𝑢𝑟𝑒 − 𝐵𝑎𝑠𝑒 𝑌𝑒𝑎𝑟 𝐹𝑖𝑔𝑢𝑟𝑒


    𝑃𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒 𝑐ℎ𝑎𝑛𝑔𝑒 = 𝑥 100
    𝐵𝑎𝑠𝑒 𝑌𝑒𝑎𝑟 𝐹𝑖𝑔𝑢𝑟𝑒
    Example-Percentage Change Analysis Income Statement
    Working demonstrated in excel
    Income statement Nestle Pakistan
    2019 2018 2019
    Sales - net 115,962,473 120,701,038 - 4,738,565 -3.93%
    Cost of goods sold 82,613,501 81,887,248 726,253 0.89%
    Gross profit 33,348,972 38,813,790 - 5,464,818 -14.08%

    Distribution & selling expenses 14,656,501 15,625,633 - 969,132 -6.20%


    Administration expenses 3,667,718 3,108,623 559,095 17.99%
    Operating profit 15,024,753 20,079,534 - 5,054,781 -25.17%

    Finance cost 3,187,695 1,855,789 1,331,906 71.77%


    Other expenses 1,390,138 1,512,112 - 121,974 -8.07%
    4,577,833 3,367,901 1,209,932 35.93%
    Other income 268,790 255,308 13,482 5.28%
    Profit before taxation 10,715,710 16,966,941 - 6,251,231 -36.84%
    Taxation 3,361,243 5,355,382 - 1,994,139 -37.24%
    Profit after taxation 7,354,467 11,511,559 - 4,157,092 -36.11%
    Example Solution-Percentage Change Analysis Income Statement
    Working demonstrated in excel
    Statement of financial position Nestle Pakistan
    Assets 2019 2018 2019
    Non-current assets
    Property, plant and equipment 30,333,121 30,363,333 - 30,212 -0.10%
    Capital work-in-progress 3,441,066 3,679,302 - 238,236 -6.48%
    Intangible assets 7,396 15,464 - 8,068 -52.17%
    Long term loans 239,499 305,333 - 65,834 -21.56%
    34,021,082 34,363,432 - 342,350 -1.00%
    Current assets
    Stores and spares 2,376,057 1,951,900 424,157 21.73%
    Stock-in-trade 18,876,441 19,711,784 - 835,343 -4.24%
    Trade debts 2,164,888 3,116,948 - 952,060 -30.54%
    Current portion of long term loans 132,045 132,729 - 684 -0.52%
    Salex tax refundable 4,599,004 4,552,598 46,406 1.02%
    Advance, prepayments & other receiv. 2,785,138 2,584,926 200,212 7.75%
    Cash and bank balances 318,753 745,694 - 426,941 -57.25%
    31,252,326 32,796,579 - 1,544,253 -4.71%
    65,273,408 67,160,011 - 1,886,603 -2.81%
    EQUITY AND LIABILITIES
    Example Solution Issued, subscribed and paid up capital 453,496 453,496 - 0.00%
    Share premium 249,527 249,527 - 0.00%
    Percentage Change General reserve 280,000 280,000 - 0.00%
    Accumulated profit 2,272,943 3,037,201 - 764,258 -25.16%
    Analysis 3,255,966 4,020,224 - 764,258 -19.01%
    Non-current liabilities
    Balance Sheet long term finances 3,780,294 9,064,730 - 5,284,436 -58.30%
    Working demonstrated lease liabilities 303,729 217,530 86,199 39.63%
    in excel Deferred taxation 1,960,850 2,443,197 - 482,347 -19.74%
    Retirement benefits 2,777,502 2,098,020 679,482 32.39%
    8,822,375 13,823,477 - 5,001,102 -36.18%
    Current liabilites
    Current portion of long term liabilites 395,084 420,285 - 25,201 -6.00%
    Short term borrowings 17,217,473 15,242,800 1,974,673 12.95%
    Running finance 6,141,325 1,418,301 4,723,024 333.01%
    Customer security deposits 192,724 195,431 - 2,707 -1.39%
    Unclaimed dividend 20,608 20,608 - 0.00%
    Trade and other payables 25,782,895 31,745,031 - 5,962,136 -18.78%
    Interest and mark-up accrued 444,958 273,854 171,104 62.48%
    53,195,067 49,316,310 3,878,757 7.87%
    65,273,408 67,160,011 - 1,886,603 -2.81%
    THANK YOU!!

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