AN EMPIRICAL ANALYSIS OF FINANCIAL STATEMENTS OF SONALIKA INDUSTRIES

ABSTRACT

Financial statement analysis is the process of analyzing a company’s financial statements for decision-making purposes. External stakeholders use it to understand the overall health of an organization as well as to evaluate financial performance and business value. Internal constituents use it as a monitoring tool for managing the finances.  Financial statements are cantered around generally accepted accounting principles (GAAP) in the U.S. These principles require a company to create and maintain three main financial statements: the balance sheet, the income statement, and the cash flow statement. Public companies have stricter standards for financial statement reporting. Public companies must follow GAAP standards which require accrual accounting. Sonalika Group is one of the top five tractor manufacturers in India. Sonalika group started its journey of success during 1976 when foundation of small-scale unit to fabricate and assemble wheat-harvesting machines was laid. In this paper I compare the financial position of last two years of Sonalika (International Tractors Limited).This study has been conducted to know the liquidity position with respect to short term position of the company.                                                                                           

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