Question #4
Reading: Reading 13 Integration of Financial Statement Analysis Techniques
PDF File: Reading 13 Integration of Financial Statement Analysis Techniques.pdf
Page: 2
Status: Correct
Correct Answer: A
Question
An analyst is developing a framework for financial statement analysis for his firm. The primary goal of financial statement analysis is to:
Answer Choices:
A. justify trading decisions for purposes of the Statement of Code and Standards
B. document portfolio changes for purposes of the Prudent Investor Rule
C. facilitate an economic decision
Explanation
The primary goal of financial statement analysis is to facilitate an economic decision. For
example, the firm may use financial analysis to decide whether to recommend a stock to
its clients. Documentation and justification of trading decisions may be aided by financial
statement analysis, but these are not the primary purposes.