Financial indicators are quantitative measures used to assess a company's financial performance. They may be ratios, rates, absolute values or numbers.
Visit financial indicators are useful in a company because they allow :
- Track the company's financial performance over time;
- Identify areas for improvement ;
- Make informed decisions to improve the company's financial performance.
Financial indicators can be used by a variety of players within a company, including :
- Executives to make strategic decisions;
- Managers to manage the company's activities;
- Investors to assess a company's profitability;
- Bankers to assess a company's solvency.
To use them, it's important to choose the most relevant financial indicators for the company. These indicators must be adapted to the company's size, sector of activity and objectives.
It is also important to collect the data needed to calculate financial indicators reliably and regularly. This data can be collected from the company's annual accounts, management software or dedicated information systems.
Over the course of this week, we'll be taking a look at five key indicators that we believe are crucial to your company's success, and that every CFO and CEO should have a constant eye on.
