Business Ratios and Formulas: A Comprehensive Guide

by Steven M. Bragg

Book Overview

A complete appraisal of analytical tools available to managers to assess performance "Steve Bragg has created a useful, relevant guide to applying performance measurements across the organization. His... This description may be from another edition of this product.

• Format: Hardcover
• Language: English
• ISBN: 0471396435
• ISBN13: 9780471396437
• Release Date: September 2002
• Publisher: Wiley
• Length: 352 Pages
• Weight: 1.60 lbs.
• Dimensions: 1.1" x 6.1" x 9.4"

Customer Reviews

Great Ratio Analysis reference book

This is a great reference book for Financial Statement Ratio Analysis. Unlike some other ratio analysis books, this one has more ratios than you would ever need to use even in the most in-depth analysis of a companies financials. The layout of the book flows naturally, meaning that the book divides the ratios into categories like Liquidity, Solvency, Performance, Return on Investment, etc... the one shortfall here is though you'd expect the ratios to flow from one into the other as you pick a category and investigate it, you'd be wrong. For example, The Current, Quick, and Cash ratios are some of the most important starter ratios for Liquidity test and you'd expect the section on Liquidity to start with them, but it doesn't. It starts with Accounts Receivable Turnover ratio followed by Average Receivable Collection Period. Although that is important, it's not where one typically starts during a liquidity test, so the author could have organized the ratios with a little more thought. Nevertheless, this disadvantage is outweighed by the advantage of having a good explanation of what each ratio means with a hypothetical example for every single ratio. It's my conclusion that this book is made for people with an existing knowledge of Accounting. Beginners would have a difficult time with this, as the book is filled with jargon. Accountants and professional analysists would love this, because all the jargon just saves us time. We hate it when books like these try to cater to everyone, including amateurs, and in the end just 'water down' the content. We just want that ratio and a quick explanation in OUR language of what it means and how to interpret it. This book does just that. If you're looking for a Ratio reference book, you should definitely have this one as part of a larger collection, since having one ratio reference book is not enough and you always need to cross-reference if you get lost along the way.

Very Comprehensive

If one can gramattically apply the modifer "very" to "Comprehensive" this is the palce to apply it. This book has become an essential tool in my reference library. If you are serious about communicating an important message, this will help. I particularly like the comments on the appropriate use and potential misuse of each ratio.

Great reference

This book makes a great reference for those that use business formulas on a normal basis. It presents all the normally used formulas in a single book and some special use formulas also. A must for any business library.

Set up your books so performance can be measured

This is not an easy-read book. It is much like a cookbook - there are all kinds of recipes (formulas) identified and explained. A must-read for anyone who wants to start, run, and grow a business. After reading this book you should be impressed with the fact that every business can be viewed as a database of numbers (statistics). The quality of the databases will vary, often significantly, but all businesses can build quality databases if they so desire. If they do, then they can take advantage of the priceless information included in this book. I used to work for a small company that refused to keep accurate accounting records. All they worried about it seemed was the cash flow schedule so they could pay their bills. I tried to impress upon them the importance of well-kept books so the health status of the business could always be identified quickly, and strategic planning could be performed to increase profitability or to pursue growth pursuant to a plan. If they had kept books as I suggested, then they wold have been able to take advantage of the book I'm reviewing here. By reading this book and taking note of the financial data necessary to plug and chug the formulas, you will be knowledgeable about how to set up your accounting records on Quickbooks Pro or whatever other accounting software your company uses. And the better those accounts are set up, the better you will be able to use the information provided in this book.

An excellent business resource

Business Ratios and Formulas, A Comprehensive Guide, is the most thorough reference book of its type. Steven Bragg provides a complete explanation of each business ratio and formula and follows each with a scenario example of their applications. Also provided is a discussion of how the resultant calculation can be misleading or should be used in conjunction with other ratios. I have not seen this feature in any other book of its kind. Another excellent feature of the book is the chapter on "Measurement Analysis with an Electronic Spreadsheet", which describes the use of Microsoft Excel to assist the business professional in automating the analysis. Five types of analyses are included in this chapter: financial statements, project analysis, investment analysis, risk analysis and trend analysis. In the introduction to the text Mr. Bragg states, "Even if a company has developed a reasonable set of measurements, this does not mean that they should never be changed." As a controller I am in the process of re-examining my company's measurement process. This book is an invaluable resource. Excellent for both the professional and student. A book I wish I had during my MBA studies.