Comparative analysis of financial statement between two Textile Company’s

2. 2

8. A comparison of relationship among account
balances. The term accounting ratio is used to
describe significant relationship between
figures shown on a balance sheet, profit and
loss account or in any other part of accounting
organization.
For the performance measurement of
Ashraf textile & Saiham textile mills Ltd. In
below we are going to analysis about the
two companies financial statement using
ratio analysis. Here are belongs

9. 4
2.16
1.35 1.54
2 0.97 2009
0
2008
Shiham Textile Mills Ltd.
Asheaf Textile Mills Ltd.

10. 3
2.06
2 1.23 1.38
1
0.93 2009
0
2008
Shiham Textile Mills Ltd.
Asheaf Textile Mills Ltd.

11. Debt/equity ratio =
Total liabilities/ shareholders 'equity
1.71
1.34 Shiham Textile
Mills Ltd.
Asheaf Textile
2.54 Mills Ltd.
3.05

12. Account receivable turn over=
Net sales / average account receivables
177.08
200
131.69 51.27
150
100 2009
26.53
50
2008
0
Shiham Asheaf
Textile Mills Textile Mills
Ltd. Ltd.

13. Inventory turn over =
Cost of good / average inventory
150
70.21 61.46
100
50 63.86 79.34 2008
0
2009
Shiham TextileAsheaf Textile
Mills Ltd. Mills Ltd.

14. Total asset turn over =
Net sales / Average total assets
Shiham
0.39 0.28 Textile Mills
Ltd.
Asheaf Textile
0.46 0.54 Mills Ltd.

15. Gross profit margin =
Grossprofit / Netsales
Ashraf 38.01% 32.26%
Textile Mills Ltd
Saiham 18.56% 31.52%
2009
Textile Mills Ltd
2008
0.00% 20.00% 40.00% 60.00% 80.00%

16. Net profit margin =
Netincone / Netsales
Ashraf
Textile Mills Ltd
17.94% 13.68%
Saiham
11.66% 18.66%
2009
Textile Mills Ltd
2008
0% 20% 40% 60% 80% 100%

18. Saiham Textile Mills Ltd & Ashraf Textile Mills
Ltd Which are profitable companies, but both
of the companies need to increase their
liquidity and asset management position. On
the other hand they should pay their liabilities
as soon as they can, and increase its owner’s
equity than its liabilities. Cost and expenses
should be reduced so the company can
generate more profit. Company should sale
their shares on the high market rates and pay
more dividend to their investors.

19. 19

20. ? 20