Setup ABSS for financial analysis ratios

With the release of Accounting v28.3 and ABSS Premier v23.3, ABSS included a financial analysis report.

This report helps business owners understand how their business is performing and identify areas that would need improving.

Before you can start using this report, you will need to set it up within your company file.

Edit account details

To use this report, you need to link the relevant accounts to respective categories used in ratio analysis.

This can be done by selecting the ‘Financial Analysis acc group’ in Edit Accounts > Details tab.

Edit account details

You can select financial analysis account group from the dropdown list.

To understand which category requires mapping, please refer to the formula stated in the report, and map your accounts accordingly to get desired result.

There are three types of analysis provided in this report:

  1. Liquidity Ratios

    Cash Ratio
    A liquidity ratio that measures a company’s ability to pay off its current liabilities with only cash and cash equivalents.

    Current Ratio
    A liquidity and efficiency ratio that measures a company’s ability to pay off its short-term liabilities with its existing assets.

    Gearing Ratio
    A performance ratio shows the proportion of finance that is provided by debt relative to the finance provided by equity.

  2. Performance Ratios

    Interest Coverage
    A performance ratio that measures the company’s ability to meet its interest payments.

    Return On Capital Employed % (ROCE)
    A profitability ratio that measures the returns that a company is achieving from the capital employed.

  3. Profitability Ratios

    Return On Sales %
    A profitability ratio that calculates how efficiently a company is at generating profits from its revenue.

    Gross Profit Margin %
    A profitability ratio that measures how efficiently a company uses its cost of goods sold to produce and sell products profitably.

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