| Abstract |
New entrepreneurs generally struggle to sustain their business in the first few
years due to financial management incompetency. Their inability to provide
analyses for the overall business conditions such as profitability, liquidity,
efficiency and leverage eventually leads the business to failure. The Ratio
Analyser (RAN) is an analysis tool that enables its user to run ratio analysis
for the business. The tool uses forecasted figures to oversee their business
ability in terms of future performance including profitability, liquidity, efficiency
and leverage ratio. It provides initial prediction for business performance
based on the financial management analysis. RAN is useful for someone who
just plan to start business in getting information on return of asset, return on
equity, forecasting sales, revenues and profit, and most important is
preventing losses in doing business. Entrepreneurs will be able to expect the
performance of their business, which improves decision-making processes
related to financial management. This effectively reduces the business risk.
RAN is highly effective as a fundamental tool for SWOT, and Investment Cost
and Benefit analyses for new businesses. Investors would also greatly benefit
in using this tool when screening for businesses with optimal potential.
Furthermore, higher education institutes may implement the tool for training
students in accurately assessing business performances as part of their
syllabus. |