Study Material & Notes for the Chapter 11
Financial Statements Analysis & Tools
II. COMPARATIVE STATEMENTS
i. Comparative Statements
- It is the statement prepared to compare individual items or components of the financial statements of two or more years of a company.
- The amount of each component of company’s financial statements is placed side by side and difference is ascertained, which is shown as a percentage of the base year.
- A comparison of components of company’s financial statements of two or more years is known as Intra-Firm comparison, whereas Comparison of company’s financial statements with another Organisation is called inter-firm comparison.
ii. Comparative Balance Sheet
- It is the statement prepared to compare individual items or components of Balance Sheet of two or more years of a company.
iii. Comparative Statement of Profit & Loss
- It is the statement prepared to compare individual items of Statement of Profit & Loss of two or more years of a company.
