CFA L2 学习笔记2-financial reporting and analysis.doc

Financial Reporting and Analysis defensive interval ratio=(cash + short-term marketable investments + receivables) / daily cash expenditures financial leverage ratio ( equity multiplier )= average total assets / average shareholders’ equity interest coverage ratio = EBIT / interest payments fixed charge coverage ratio= (earnings before interest and taxes +lease payments)/ (interest payments +lease payments) dividend payout ratio = common share dividends / net income attributable to common shares sustainable growth rate = retention rate * return on equity earnings per share = ( net income – preferred dividends) /weighted average number of ordinary shares outstanding Free cash flow to equity (FCFE) = cash flow from operating activities – investment in fixed capital + net borrowing Free cash flow to the firm (FCFF) = cash flow from operating activities + interest expense *(1- tax rate) – investment in fixed capital Inventory turnover ratio = COGS / Average inventory Return on assets = NI / Average assets accounts receivable turnover = sales / accounts receivable Reading21 Inventories: Implications for Financial Statements and Rations COGS= beginning inventory +purchases –ending inventory. The COGS and ending inventory are inversely related. LIFO reserve= inventory under FIFO - inventory under LIFO；inventory under FIFO = inventory under LIFO + LIFO reserve COGS under FIFO = COGS under LIFO – change in LIFO reserve NI under FIFO=NI under LIFO + change in LIFO reserve*(1-tax rate) Retained Earnings under FIFO=RE under LIFO + LIFO reserve*(1-rt) Under FIFO, income before taxes is higher, taxes paid is higher, cash is lower, inventory increases by a larger amount than cash decreases, and shareholders’ equity is higher because of higher retained earnings. LIFO better reflects replacement cost, so its gross profit margin would best reflect current costs of the industry. As LIFO reserve is decreasing, it may reflect a LIFO liquidation(后进先出法清算，一般发生在期末存货少于期初存货的情况下) which may