Describe factors to analyze a company position, Financial Management

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Q. Describe Factors to Analyze a Company position?

- Venture capitalists may be involved in the business because of its significant growth but poorly structured finance. An equity injection would steady the business' finances.

- Future projections of growth might offer a clearer picture of how to respond to the business' situation.

- The maturity of the debt obligations would point out any critical repayments that may be due.

- Comparisons with other businesses in the sector may perhaps provide some assurance as to the debt levels if high debt is a characteristic of the sector.

- Investigation of probably renegotiation of the debt to ease the interest burden.

- Investigation of potential sale of the business or else merger with a large partner with a view to securing a realistic equity base.

- Information on detailed trading results would make possible an accurate assessment of the profitability of AIS Ltd.

- Working capital management requires to be investigated to assess if it is being efficiently organised.


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