Return on Total Asset (ROA)
1. EXPLANATION ABOUT FINANCIAL STATEMENT ANALYSIS
Financial statement
analysis is one of the task financial manager as internal party who is
responsible for the company’s financial statement.
2. SCOPE OF FINANCIAL STATEMENT ANALYSIS
Scope of financial statement analysis,
that is:
a. Liquidity
Analysis
Liquidity analysis aims at analyzing
whether the firm has enough liquidity to meet its obligation when they should
be paid.
b. Solvency
Analysis
Solvency analysis aims at analyzing
whether the ability of company to pay its long term debt and the interest on
that debt.
c. Profitability
Analysis
Profitability analysis is a component of
enterprise resource planning that allows administrators to forecast the profitability
of a proposal or optimize the profitability of an existing project.
d. Cash
Flow Analysis
Cash flow analysis is the study of the
cycle of your business cash inflows and outflows, with the purpose of
maintaining an adequate cash flow for your business, and to provide the basis
for cash flow management.
e. Bangkruptcy
Analysis
Bangkruptcy risk describes the like hood
that a firm will become insolvent because of its inability to service its debt.
f. Risk
Analysis
Risk analysis is a broadly defined to
include risk assessment, risk characterization, risk communication, risk
management and policy relating to risk.
g. Investment
Analysis
Investment analysis is a look back at
previous investment decisions and the thought process of making the investment
decision.
There are seven types of profitability
analysis, that is:
1. Gross
Margin Percentage
2. Earning
Per Share
3. Price
Earning Ratio
4. Devidend
Payout Ratio
5. Devidend
Yield Ratio
6. Return on Total Assets (ROA)
7. Return
on Common Shareholders’ Equity (ROCE)
3. EXPLANATION ABOUT RETURN ON TOTAL ASSET
Return on assets (ROA)
is a financial ratio that shows the percentage of profit a company earns in
relation to its overall resources. It is commonly defined as net income divided
by total assets.
Formula:
4. FINANCIAL STATEMENT
This is financial statement:
5. RESULT OF ANALYSIS AND CONCLUSION
For example:
Analysis of the ratio on total assets of
PT United Tractors Tbk
Year
|
Net
Income
|
Total Assets
|
ROA (%)
|
2008
|
2.660.742
|
22.847.721
|
11,6
|
2009
|
3.817.541
|
24.404.828
|
15,6
|
Conclusion:
In
2008, any asset that is used to generate profit of 11,6% and in 2009, any asset
that is used to generate a profit of 15,6% so that the profitability of PT
United Tractors Tbk and Subsidiaries increased in 2009 about 4 %.
