In order to improve the usage of financial information in the context of the decision
making process, we need to analyze financial statements. In that context, we can
describe financial statement analysis as the process where we convert data from
financial statements into usable information for business quality measurement by
different analytical techniques, which is very important in the process of rational
management. Therefore, to know the current level of business quality is very significant in
the context of future business management, since we try to ensure company’s
development and existence on the market. Financial statement analysis comes before
the management process that is before the process of planning which is the component
of the management process. Planning is very important for good management. Good
financial plan has to consider all company’s strength and weaknesses.
The task of financial statement analysis is to recognize good characteristics of the
company so that we could use the most of those advantages, but also to recognize
company’s weaknesses in order to take corrective actions. Because of that, we can say
that management of the company is the most significant user of financial statement
analysis.