ROE – Return on Equity is an important financial ratio. ROE measures how much profit is generated from the equity invested in a company. It is expressed as a percentage. ROE – Return on Equity: Definition and Formula The primary goal of any company is (or should be) profit maximization. An owner who invests money… Read More »
Due diligence can be used in various contexts, however, it is typically a term from the fields of finance and mergers & acquisitions (M&A). We can interpret it in different ways. The most accurate meaning is in-depth analysis. Due Diligence – Definition, Purpose, and Importance Within due diligence, we systematically conduct an in-depth analysis of… Read More »
Before describing individual methods, indicators, and approaches, we will first create a kind of overview page containing all the key terms. Financial analysis is a broad discipline, and this summary will be useful. Here you will find definitions, categories of financial analysis, and links to individual articles that I will gradually prepare. What Is Financial… Read More »
Vertical analysis is one of the tools used in financial analysis. This method examines the proportions (ratios) of different items in financial statements. What is Vertical Analysis – Definition Vertical analysis (also called common-size analysis) provides insight into the structure of financial statements. The principle of this method is to express individual items in the… Read More »
With the term “Finance covenants” we often encounter it in contractual documentation in the field of finance. It frequently appears in loan agreements (bank vs. company), prospectuses for bond issuer programs, or other financial agreements between two or more parties. What is a Financial Covenant – Definition A financial covenant can be defined as an… Read More »