Description
TABLE OF CONTENT
TITLE PAGE
CERTIFICATION
DEDICATION
ACKNOWLEDGEMENT
TABLE OF CONTENT
CHAPTER ONE
INTRODUCTION 1
- Background of the Study 1
- Statement of the Problem 3
- Justification of the problem 4
- Scope of the Study 5
- Limitation of the Study 6
- Research hypothesis 6
- Plan of the Study 7
- Definition of the Study 8
CHAPTER TWO
- Literature Review 9
- Users of Financial Statement 11
- Management of an Organization 13
- Performance Evaluation 14
- Management control System 15
- Method of Performance Evaluation 16
- Analysis and Interpretation of
Financial Statement 16
- Definition and Relevance of Financial Ratio 17
- Classification of Ratio Analysis 17
CHAPTER THREE
3.0 Research Methodology 23
- Type of Data 23
- Population and Sample Size 24
- Method of Data Collection 24
- Method of Data Analysis 24
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
4.0 Introduction 26
- Socio-Dittographic Characteristic of Respondents 27
- Presentation of Questionnaire Response 30
- Testing of Hypothesis 33
- Result and Analysis of Liquidity Ratios 36
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
- Summary 37
- Recommendation 37
- Conclusion 39
BIBLIOGRAPHY 41
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The amount of proportion of one figure compare to another makes financial statement to be obviously important to enable user have a clear picture of position of organization. It report the liquidity and solvency of the company and the claim of it resources i.e. debt owned, the equity of the owner and present cash position of the company.
It comprises comparative balance sheet, profit and loss account, income statement, cash – flow statement, auditors report and some officer necessary information base on your assessment.
Despite the functions of financial statement many users often fail to comprehend fully on the information it intending to pass across, thus there desire are not met. This is due to ambiguous of the financial statement where by the volume of data figure mislead the user. In this sense, the need for analysis and interpretation of statement are imperative. Financial statement can be converted and interpreted using three techniques.
- Vertical or Static Analysis: It examine relationship within a statement, it deals with use of relative percentage value of the statement.
- Horizontal or Dynamic Analysis: This involves comparison of financial statement in respect of the two or more years. The weakness of this analysis in that comparison with the past does not afford any basis for evaluation in absolute terms.
- Ratio Analysis: Involve the use of two different economic units to ascertain performance. Ratio analysis commonly uses technique in analyzing financial statement. It is obviously paramount since it checks how strong or weak company is. Therefore, its interpretation is easily understood by the user.
1.2 STATEMENT OF THE PROBLEM
Financial ratio analysis it widely use to assess the performance of an enterprises. Financial statement is prepared in terms of historical costs. They do fully reflect economic resources and managerial, hence poor decision may be made. The users of financial information are carried away by the figures display in financial investment. Observing the trends of the financial investment as assess whether their resources have been put to effective use. The analytical comparison of large information is a problem to the user.
Financial ration analysis should be applied to provide meaningful and quantitative presentation of the company and external creditors. Also there is need for financial analyst to produce a small and understandable data for good decision.
1.3 JUSTIFICATION FOR THE STUDY
Ratio analysis been what it is, as the production of relation for internal and external financial reports are important to summarize key relationship and result in order to appraise financial performance.
In its assessment, this research will be of immense value in recent knowledge of enterprises and managerial achievement. This research is very useful to user to supplement the existing knowledge of the user of financial ratio as guide towards the determining company’ achievement as well as show how financial ratio analysis can identify the strength and weakness of a company.
The research work can also serve as material for student who are interested in the study of financial ratio as a tool for performance appraisal.
1.4 SCOPE OF THE STUDY
This study has limited to five year financial summary of the First Bank Nigeria Plc, profit and loss account, the balance sheet, value added statement, using ratio and adequate interpretation.
This study is carryout base on the fact that amount presents a true and fair view of the company’s affairs and not misleading.
More so, financial ratio will be compared with that of previous year using common size of statement trends analysis that is reaction of the economic unit over time of the firm horizontal analysis.
The period was choosing because of the availability of financial statement representing it operation within the period 1999 – 2002.
1.5 LIMITATION OF THE STUDY
In the case carrying out the research the following limitation are encountered.
The major limitation is the high cost of transportation and insufficient fund to other schools library subsequently to this problem is a combination of academic work with represent study. The refusal of asset to the unpublished information, which has been term confidential time factors “the time that was in the conduct of research constituted constrain of the study”
1.6 RESEARCH HYPOTHESIS
For the objective of the study the researcher would want to know the input of ratio analysis as a tool to measure managerial performance to ratio analysis can not serve as a tool for performance appraisal in Nigeria Financial Market.
Hi Ratio analysis can serve as a ratio for measuring profitability and efficiency of a firm while chi-square is used to rest the validity of hypothesis.
1.7 PLAN OF THE STUDY
The research is written to examine financial ratio analysis as a tool for performance appraisal.
The study begin with chapter one that deals with the background of the study, statement of problem, justification of the study and definition of terms. Chapter two deals with the Literature Review of the work of other author related to the research methodology: type of date population and sample size, method of date collection, method of data analysis and brief history of First Bank Nigeria Plc, Chapter four embraces the data presentation and analysis of liquidity ratio chapter five deals with summary, conclusion, recommendation, and bibliography.
1.8 DEFINITION OF TERMS
- Performance: Is the ability to operate efficiently as well as an action or achievement consider in relation to it is Oxford Advance Dictionary.
- Financial Statement: Are the instrument panel of business enterprises and constitute a report on managerial performance arresting to managerial failure or success and flushing warming signal of impending difficulties (Meigs and Meigs 1979)
- Ratio: Is a simple mathematical expression of the relationship of one item to the other
- Balance Sheet: A statement of financial position showing the nature and amount of company asset and liabilities and net worth of a particular company.
- Working Capital: Is the excess of current asset over current liability of a business.
- Trends: Movement in data revealed by statistical process.
CHAPTER TWO
2.1 LITERATURE REVIEW
A ratio analysis of the financial result of the selected company, compared to selected competitors. Also included are quantitative analysis of the company’s financial statements, extensive ratio analysis and up to 10years history of sales, earnings, dividends and security pricing. A business description of the company, including contact information, senior officers and weight quality Rating analysis is also provided. First Bank of Nigeria maintains the largest in the Nigeria Financial Service Industry. Furthermore, its track record of profitable and reliability in professional banking service has continually placed the bank in it trading position with return on equity of 31,29% and earning per share of N1.96 (as at date) as the highest in the banking sector.
THEORETICAL FRAMEWORK
Financial ratio analysis is define by Pandy (2001) to be process of identify the financial strength and weakness of a firm by properly establishing relationship between the item of the balance sheet and profit and account.
Ishola (1995) stated the ratio analysis involves comparing one figure against another to produce a ratio and assessing whether the ratio indicate weakness or strength of the company affair.
According to Olowe (1995) ratio analysis is the relationship between financial data in the financial statement to aid financial condition and performance of a firm.
While Lucey (1998) stated ratio analysis is the systematic production of a ratio from both internal and external report as to summarize the key relationship and result in order to appraise the financial performance. But a ratio analysis can not be done without basically involving the use of financial statement, which is commonly used to evaluate business financial condition namely:
- The Balance Sheet: It shows the financial position of the firm by showing it asset and liability.
- The Cash Flow Statement: It shows how cash has been generated and disposed off by an organization it is useful for preparing cash budget (F Wood and A. Santer 1999).
- The Profit and Loss Account: It shows the profitability of the company as that period.
2.2 USERS OF FINANCIAL STATEMENT
Users of financial information rely heavily on detailed of financial statement to judge the operating performance of the company.
The operate report published in Britain (1986) identify some groups of interested partied of financial statement. They are equity invested (shareholders), debenture holder/creditor, government, employer, analyst and business contract (partnership) and public. The management of the organization also uses the report for internal purpose. The areas of need are explained below according to the group.
- Management: These are the internal user financial statement is used by the management in making important operating decision.
- Shareholders: They are investors and needed information about firm’s financial status and its future prospect in term of return.
- Partnership Agreement: They are interested in financial soundness and solvency prior to entering business relationship.
- Professional Adviser: These are financial analyst and attempt to established trend and analysis of the result of particular business.
- Tax Agencies: They are concern about profit made for the purpose of tax applicable.
- Creditors: They confirm creditor worthiness of the firm and check asset and use asset to stand as collateral.
2.3 MANAGEMENT OF AN ORGANIZATION
Management involves the process of planning organizing and controlling the activities of firm towards business objectives.
Leadership is an integrities part of management. This leader are called managers or collectively called the Management. A successful management is expected to the following:
- Assess performance honestly and realistically.
- The need to make sound and timely decision.
iii. Seeking for higher responsibility of acceptance of full responsibility for his action.
2.4 PERFORMANCE EVALUATION
Performance can be said to be relationship between accomplishment (output) and effort (input), so performance is review of result with a view to ascertain the efficiency of actual performance. It is only when performance are evaluated that conclusion can be made on efficiency and effectiveness of the organization.
Performance evaluation can be review in two ways:
- Financial Performance
- Managerial Performance
2.4.1 FINANCIAL PERFORMANCE
Financial Performance can be regarded as the firms overall activities in accounting period. It examines the liquidity, profit abilities investment utilization, solvency and financial leverage. For financial performance to be evaluated, it needs financial information to know the financial position within a particular accounting period.
2.4.2 MANAGERIAL PERFORMANCE
Managerial performance assesses the individual performance base on achievement of objectives and ability to solve a problem as through idea and innovations of individual as well as manager.
2.5 MANAGEMENT CONTROL SYSTEM
Management control system is defined as strategic processes by which a manager ensures that organization attain the set standard. The functions embedded in management control system are: involves establishing of objectives, formulation evaluation and selection of policy, strategic, and action require achieving this objective. There are three classification of planning on base time dimension and duration
- Short term planning.
- Medium term planning.
- Long term planning.
2.6 METHOD OF PERFORMANCE
Performance evaluation can be done with two methods namely: inter firm analysis and inter-firm analysis.
- Inter-firm analysis: Involve comparison of firm working in the same industry.
- Intra-Firm analysis: Involves the comparison of financial figure of a firm over time.
2.7 ANALYSIS AND INTERPRETATION OF FINANCIAL STATEMENT
Financial statement analysis emphasis the examination of financial position of the company they the interpretation of amount. May be said to be art and science translating strength and weakness of a business and the cause, which are contributed there to (K.A Ishola). There are reasons analysis and interpretation which are:
- To identify the soundness of firm.
- To assess of the business entity
- To determine the financial health of the company.
Financial analysis can be categories into different type, trend analysis comparative analysis, and common size statement of First Bank of Nigeria.
2.8 DEFINITION AND RELEVANCE OF FINANCIAL RATIO
According to Oxford advanced dictionary ratio is the relationship between two amounts determine by number of times one contain in the other. Ration is the standard of comparison, the collection of ration analysis is used by accountant and by independent auditor in analytical review of an auditor in analytical review of an audit.
2.9 CLASSIFICATION OF RATIO ANALYSIS
This are some basic ways of classifying ratio and how it can be apply. They are:
- Classified base on use information needed.
- Classified in term of data sources
iii. Classified base on what it wants to measure
- Classified base on aggregation.
For the purpose of this study classification of ratio on what it wants to measure is used. These are ratio that concerned with financial analysis of the company.
- Liquidity and solvency ratio
- Activity ratio.
- Profitability ratio
- Investment ratio.
These entire ratios are used for analysis of the financial statement of Bank of Nigeria Plc in next chapter.
- Liquidity and Solvency Ratio: It measures ability of the company to meet it current obligation and her. It is necessary to strike a balance because how liquidity ratio makes company become insolvency which leads to bad credit image likewise high liquidity ratio leads to idle assets earning nothing. The most common ratio which indicates the existence of liquidity is:-
- Current Ratio: It compares the liquid assets of the business with the short time liabilities. It calculates as follows
Current Ratio: Current Asset
Current Liabilities
- Acid Test Ratio: This ratio is refinement of the current ratio in business where the stock turns over is slow is also known as quick ratio.
Current Asset – Stock
Current Liability
- Average Collection Period: It shows the average length of time in which debt remain uncollected. It is calculated thus.
Average collection period Debtors + 365days
Annual Credit Sales
- Fixed Asset Turnover: Sales
Net Fixed Asset
- Activities Ratio: These ratios are good indicated of the cash elasticity of asset. They are:
- Stock turnover: This is another measure of how rigorously a business is trading.
Opening Stock + Closing Stock
Average Stock
Note: Average Stock = Opening + Closing Stock
2
- Debtor Turnover: It shows the degree of responsiveness of debtors, it is calculated as debtors’ turnover
Annual Credit Sales
Debtors
- Dividend Yield Ratio: This is used to evaluate shareholders return in relation to current market value of the share. It is computed as
Dividend yield Ratio: Dividend on the Share x 100
Current market value per share.
- E.P.S.
Earning Available to Ordinary Shareholder
Number of Ordinary Share in Issue
Or
Net Profit after Tax
Number of Ordinary Share in Issue
- Price Earning Ratio: Is the ratio of a company current share price to earning per share it is computed as follow:
Price Earning Ratio: Market Price Per Share
Earning Per Share
- Profitability and Efficiency Ratio: This is ratio use to measure the operating efficiency of the company in term of profit. Profitability ratio is of two types:
- Gross Profit Margin: It is the gross profit express as a percentage of net sales or turnover it is calculated thus:
Gross Profit Margin Gross Profit x 100
Sales
- Net Profit Margin: This ratio establishes a relationship between net profit and sales.
Net profit Margin Net Profit after tax x 100
Sales
- Investment Ratio: Are designed to help investors assess the return on their investment. It helps investment to appraise the performance of company in term of shares price and yield.
- Dividend per share: Dividend announce during the period
Number of share issue
- Dividend yield ratio: Dividend on the share
Earning for the year available for dividend.
- Solvency look at the ability of a firm to met long and short term creditor. They are concerned with debt payment abilities. These are the leverage ratio. They are:
- Debt Ratio: It shows the extend of cover for debt of the company by total asset debt Ratio
Total Debt
Total Asset
- Debt Equity Ratio: It measure financial claims of creditors and owners of financial against the firm assets. Its calculated as follows
Debt equity ratio Total Debt
Shareholders equity
- Gearing Ratio: Preference + Loan Capital
Ordinary share + Reserve
CHAPTER THREE
3.0 RESEARCH METHODOLOGY
This project research discusses the method of analysis sources of data, relevant areas of investigation and data collection. The essences of a data collected are subjected to analysis so that the work is justified and objective of the work are achieved.
3.1 TYPE OF DATA
In the case of this study the method of gathering was done with use of both primary and secondary data.
Primary data are raw data collected by the researcher himself. Secondary data are information collected through search into relevant text books, magazine, journal on the subject matter of his study.
3.2 POPULATION AND SIMPLE SIZE
The population of this study constitutes all users of ratio analysis. It is practically impossible to cover the whole population as a result, sample is determined the size was limited to (50) Fifty respondents, which primarily constitute member/staff of First Bank Plc representing a sub-set of the population.
3.3 METHOD OF DATA COLLECTION
The data are collected using questionnaire administered by the respondents.
Furthermore, from financial statement of bank collected further data analysis was also carried out through mathematical calculation and model.
3.4 METHOD OF DATA ANALYSIS
Tests were carried out using financial ratio on what it wants to measure. It include activity ratio, liquidity and slovenly ratio, profitability and efficiency ratio was carried out using all man models
2 = 0.012 x 1 + 0.014 + 0.033 x 3 + 0.3 x 4 + 0.01
Where x1 = Gross Current Asset
Gross Total Asset
X2 = Retained Earning
Gross Total Asset
X3 = Profit Before Interest and Tax
Gross total Asset
X4 = Marketing Value of Equinity
Gross Total Asset
X5 = Sales
Gross total asset
Furthermore, chi-square (X2) method of statistical analysis was used to test hypothesis formulated for the study.
Chi-square (x2) is given by
X2 = E(o-e)2
E
Where O = Observed frequencies
E = Expected frequencies
CHAPTER FOUR
DATA ANALYSIS AND PRESENTATION
4.0 INTRODUCTION
This chapter is set out to present and analyzed the data collected through the application of questionnaire and also the information extracted from the annual report of the bank under review. The main research questions were recited by converting them into wall and alternative hypothesis.
Data of response are represented in tabular form out of the (50) questionnaire administered 4b were returned, this represented 92% of the questionnaire administered.
Test were also carried out in the following ratio: liquidity and solvency, profitability and efficiency and investment ratio, the test of hypothesis is done using chi-square (x2) rest or k = 0.05 level confidence.
4.1 SOCIO-DEMOGRAPHIC CHARACTERISTICS
OF RESPONDENT
This section deals with classification of respondents by sex, age, education, qualification, management cadre and working, based on questionnaire administered.
Table 4.1.1 Distribution Of Respondent Based On Sex
| SEX | Number of Respondent | Percentage |
| Male | 31 | 67% |
| Female | 15 | 33% |
| Total | 46 | 100% |
Sources: Questionnaire Survey Research Finding 2012.
The table above show the percentage distribution of respondents male constitute 67% while female respondent constitute 33%
Table 4.1.2 Distribution of Respondent By Age
| Age | Number of Respondent | Percentage |
| 20 – 29 | 16 | 35% |
| 30 – 39 | 23 | 50% |
| 40 – 49 | 4 | 9% |
| 50 – 59 | 2 | 4% |
| 60 and above | 1 | 2% |
| Total | 46 | 100% |
Sources: Survey Research Finding 2012
The table 4.1.2 shows age of the various respondents. All respondent are 20 and above. Thus the respondents are of age.
Table 4.1.3 Distribution Of Respondent By Education
| Education Qualification | Number of Respondent | Percentage |
| O’level | 2 | 4% |
| NCE/OND | 4 | 9% |
| First Degree/HND | 4 | 52% |
| Second Degree | 27 | 28% |
| Professional | 13 | 7% |
| Qualification | – | – |
| Total | 46 | 100% |
Sources: Survey Research Finding 2012
Table 4.1.3 shows that the respondents have adequate education and consequences, the information supplied are reliable and relevant for the purpose of the research.
Table 4.1.2 Distribution Of Respondent By Management
| Management Cadre | Number of Respondent | Percentage |
| Top Management | 12 | 26% |
| Middle Level | 13 | 28% |
| Lower Level | 21 | 46% |
| Total | 46 | 100% |
Sources: Survey Research Finding 2012
The table above shows various management cadre that respondent belongs to the top cadre constitute 26% middle cadre constitute 28% and lower cadre constitute 46% of the respondent.
TABLE 4.1.5 Distribution of Respondent By Working Experience
| Working Experience | Number of Respondent | Percentage |
| Above 10years | 12 | 30% |
| 10years | 14 | 35% |
| Less than 10years | 20 | 35% |
| Total | 46 | 100% |
Sources: Survey Research Finding 2012
Table 4.1.5 shows of the working experience of various respondent 35% of the respondent having working experience less than or equal to 10years.
This implies that most of the respondents are well experience. And thus the information supplied is relevant for the researcher.
4.2 PRESENTATION OF QUESTIONNAIRE RESPONDENT
This analysis is based on section B of the questionnaire.
Question One: was on whether ratio analysis can serve as an important tools per measuring profitability and efficiency 35 respondents choose yes while the remaining respondents choose no. Thus: this show a larger population of the respondent is of the view that ratio analysis can serve as important tool for measuring profitability and efficiency. Question Two: was on whether ratio analysis is good technique to aid decision making by management 41 respondents choose No: thus ratio analysis is a good decision making.
Question Three: was on whether ratio analysis serves as tools for measuring management performance. 39 respondents choose yes while 7 respondents choose No. thus it implies that population of large agrees with the use. Question Four: dose improvements in profitability ratio signify higher profit. 46 respondents choose yes. The profitability ratio improvement signifies higher profit. Question Five: was on whether leverage ratio can be used as basis of measuring management performance 40 choose Yes and 6 choose No. this indicates that population at large uses it as a basis of measuring performance.
Question Six: can ratio analysis be use to determine the strength, weakness, opportunities and threat facing a firm’s financial performance. 46 respondents choose Yes this indicates that the population can be used to determine the strength weakness and opportunities and threat facing Firm Financial Performance.
Question Seven; can comparison of the industry average ratio and those of firm in the industry be used as criteria to determine the firm position in the industry, 38 respondent choose Yes and 8 choose No. thus it shows that the majority of the population prefer the comparison of the industry be used as a criteria for determining the firm position in industry.
Question Eight: can efficiency/activity ratio help in measuring the actual efficiency of a firm. The whole 46 respondent choose yes this shows that the efficiency/activity ratio help in measuring the actual efficiency of a firm.
Question Nine: can the comparison of different years reflect the trend of growth or decline in the performance of your company. The whole 46 respondents choose Yes, this shows that the comparison of ratio of different years reflect the trend of growth or decline in the performance of your company.
4.3 TESTING OF HYPOTHESIS
The resting of the hypothesis formulated is done through the use of chi-square (x2) statistic method of data analysis these data are obtained from the questionnaire administered. The test is done at 0.05 level of significant and (r-1) (c – 1) degree of freedom.
4.3.1 HYPOTHESIS ONE
H0 – Ratio analysis can not serve as tool for measuring management performance. Ratio analysis can serve as tool for measuring the management cadre of the respondents. Thus: induces a 3x 2 contingent table as show below
| Management Cadre | Yes | No | Total |
| Top level | 10 | 2 | 12 |
| Middle level | 8 | 5 | 13 |
| Lower level | 21 | – | 21 |
| Total | 39 | 7 | 46 |
The expected frequency are E calculated
E = Total Row x Total Column
Ground Total
Chi-square (x2) is given by
X2 = E(o-e)2
E
The degree of freedom is calculated as (r – 1) (c – 1) = (3-1) (2-1) = 2
The calculated value of 9.233 is greater than the table value.
Therefore we accept the alternative hypothesis Hi, which state that ratio analysis can serve as too for measuring management performance.
4.3.2 HYPOTHESIS TWO
H0: Ratio analysis can not serve as tool per measuring profitability and efficiency of a firm.
Hi: Ratio analysis can serve as tool for measuring profitability and efficiency of a firm.
To test this hypothesis, question is used against the management level of respondents. Thus, this induced a 3 x 2 contingency table as
| Management | Yes | No | Table |
| Top level | 8 | 4 | 12 |
| Middle level | 9 | 4 | 13 |
| Lower level | 37 | – | 31 |
| Total | 45 | 8 | 46 |
Source: Contingency Table: Finding 2012
The table value of x2 0.052 = 5.991 the calculated value of 13.58 is greater than table value therefore, we accept the alternative hypothesis Hi which state that ratio analysis can serve as tool for profitability and efficiency of firm.
4.4 RESULT AND ANALYSIS OF LIQUIDITY RATIO
From table below the current ratio for First Bank Plc for period under review are computed. It can be seen that the current ratio fail from 1.44 in 1999 to 1.39 from same table it cam be seen that the bank acid test ratio fail from 1.30 in 1999 to 0.69 and 0.19 in 2001
| 1999 | 2000 | 2001 | 2002 | 2003 | |
| Current ratio | 1.44 | 1.35 | 1.37 | 1.52 | 0.02 |
| Acid test | – | – | – | – | – |
| Ratio | 1.30 | 0.69 | 0.19 | 1.52 | 2.02 |
Source: Result and Analysis of Liquidity Ratio
CHAPTER FIVE
5.1 SUMMARY
The research of the study reveals the effect of having an effective performance appraisal in financial market. It is obviously paramount since it practically evaluates performance that is, it check how strong and weak a company is.
The appearance of First Bank of Nigeria Plc ratio analysis is a powerful tools to compare, ascertain and evaluate the ability of a company and aid economy and investment decision planning and control as well as performance appraisal. So that the objectives of company could be met.
5.2 RECOMMENDATIONS
Having critically analyzed the annual report and account of First Bank of Nigeria Plc through computation of some useful ratio and chi-square method, through questionnaire some discovery are made which now bring about the following recommendation in order to improve the performance of the company if adequate concern is paid to them.
- There should be an increase in the price earning ratio of the company so that the shareholder may have confidence in future earning power of the company.
- The management should always use ratio analysis for monitoring of the company’s performance and managerial profitability measure of performance because it is effect mechanism for performance evaluation and appraisal.
- Return on capital employed ratio experience increase and decrease but later increased. The ratio been a later measure of profitability, the company should ensure that is always increase by devising better ways of managing their capital and investment they have already appraised and discover is worthwhile.
- Finally the net profit margin is relatively low, which may result from over spending on expenses, over spending should be reduce, so as to increase their net profit.
5.3 CONCLUSION
So far, it has been discovered that financial statement of a company enable an analyst to gain insight into it economic well being with a charity that can be matched by any other document or source of information.
In the preceding chapter, the most important ratio had been discussed in respect of First Bank of Nigeria Plc. For the period within 1999 – 2003 what has been found has shown some light on the performance of the company for the liquidity needs to be over value to facilitate it continuous efficiency. According to the result obtained from the analysis of this ratio for 5years under review, the performance of the company would not be considered as totally been satisfactory some are not the financial ratio used in the study to evaluate current and past financial position to and the result of the operation of First Bank of Nigeria Plc, with the primary objective to determine the best position estimate and production about the future consideration and performance.
Some ratio can not be calculated because of the nature of the business of the concern. However, what had been carried out in this study is that an intra-comparison of the company’s performance and a fair judgment of affair of the business is the strategy pillar upon which the economy of any nature rest.
A chi-square statistical method was also used through the questionnaire distribution to the respondents to test management performance and also profitability level of the company.
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Altman E.I. (1968): Financial Ratio: Discriminate Analysis and the Prediction of Corporate Bankruptcy.
Journal of finance.
Bamiduro, J.A. (2000): Introduction to management and Society, Ilorin, Timsal Nig. Enterprises.
First Bank of Nigeria Plc: Annual Reports and Accounting Limited, Great Britain.
Frank Wood and A. Sangster (1999). Business Accounting 18th Edition. Financial Time Professional Limited Great Britain.
Ishola. K. A. (1995): Foundation in Accounting. Indemac (Nigeria Publisher ), Limited Ilorin. Jonathan Crowder, (1995) Oxford Advance Learning Dictionary.
Lucey, T. (1996): Management Accounting (D.P. Publications).
Marthis. R. (2000): Analysis and interpretation of Financial Statement, Presshall.Com
Meicis .W. B. and Meigs R.F. (1979): Financial Accounting McGraw Hill, Inc.
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