In this course, we will learn how to use basic analysis tools (called ratios) to conduct a fundamental analysis of a company's financial statements. This analysis will provide insights into a company's performance and will help identify areas of concern.

We will introduce you to some of the more common financial ratios and their uses.  We will also introduce you to the DuPont framework, which is one useful way to structure the analysis of financial ratios. Finally, we will explain the use of common-size financial statements, which are easy to prepare, easy to use, and should be the first step in any comprehensive financial statement analysis. 

Keep in mind that this is merely an introduction to financial statement analysis — there are entire textbooks devoted to this topic. Our objective is simply to expose you to some of the basic tools to help you start to understand what financial statements can tell us about the operations of a business.

Learning Objectives
  • Explore the purpose of financial statement analysis. 
  • Recognize how to use common-size financial statements to compare financial statements across years and between companies. 
  • Explore the DuPont framework and how return on equity can be broken out into profitability, efficiency, and leverage components. 
  • Explore how to use cash flow information to evaluate cash flow ratios.
Last updated/reviewed: August 18, 2023
129 Reviews (510 ratings)

Reviews

5
Member's Profile
I really enjoy Professor Stice's engaging and enthusiastic teaching style - he's extremely well-versed in financial statement ratios and the meaning behind the numbers, with great examples and subtle humor that made me laugh out loud. I felt thoroughly engaged - the slides are also well-designed and a great supplement and takeaway from the course. The DuPont example was especially effective throughout. Thank you Dr. Stice - top notch course.

5
Anonymous Author
This is the best lecture I have ever listened related to the financial statement analysis! The professor offers extremely detailed explanations to illustrate every commonly used ratio to help understand the financial statements in a comprehensive way! Thanks so much for this awesome lecture!

5
Member's Profile
This course is a DEEP dive into all the commonly used financial ratios as well as the DuPont framework and common-size financial statement comparison. The instructor is very knowledgeable and uses great real-life company examples to demonstrate the power and drawbacks of ratios.

5
Anonymous Author
This is one of the best courses I have taken on Ilumneo. Mr. Stice is engaging, funny and uses real-world examples. He keeps the material interesting and has great slides to enhance the material. I would recommend this course to anyone who wants to refresh on ratio analysis.

5
Member's Profile
This course was such a good overall look at interpreting financials using ratio analysis. I liked that the instructor also told you what typical ratios are for a company as well as how to further investigate the results. His delivery was very engaging also.

5
Member's Profile
Very helpful summary of many different metrics to evaluate the financial status of a company. As an analyst, this will be very helpful in practical application, and the background and reasoning behind each ratio was clear and insightful.

5
Anonymous Author
This was a very good course and covered in such a way that is useful for both people somewhat new to financial statement analysis yet still valuable to people with more experience. The professor was very enjoyable and informative!

4
Anonymous Author
The concept of analyzing financial statements has been daunting. Trying to remember what ratios to use and why this course makes it easy to understand what to use and why. It was both practical and informative.

5
Anonymous Author
Mr. Kay gave me a full picture of doing financial ratio analysis. He explained all kinds of financial ratios in different perspective,which helped me to enhance my comprehensive ability in work! Thanks for his great work!

5
Anonymous Author
The instructor does a great job of providing an overview of the different ratios that can be used to analyze financial statements. Definitely recommend if you are looking for a good overview of the different ratios.

5
Anonymous Author
Great refresher curse on financial ratios and analysis, or great course to begin learning these concepts. Very thorough materials and great instruction. Was not boring and I was easily able to remain engaged.

5
Anonymous Author
Professor Stice - I enjoyed this course. We know that financial statements tell a story of a company's business/operations. But is the analysis of those statements that further explain the story via ratios.

5
Anonymous Author
Excellent course. Professor Stice elicits passion and understanding of financial statement analysis. The course is very well organized, paced, and presented. I'm excited to participate in his other courses.

5
Anonymous Author
This course was very intuitive and provided great insight into financial ratios. The instructor was thorough, energetic and presented the materials in an easy to comprehend fashion with numerous examples.

5
Anonymous Author
This is a very interesting course on financial statement analysis. It contains many useful information on financial performance measurement/management presented in a very clear and concise manner.

5
Anonymous Author
This course was very thorough in explaining a wide variety of financial analysis techniques with real-world examples. The instructor moves very quickly, but it is packed with useful information.

5
Anonymous Author
Superb course! Easy to understand and very useful for any accountant wanting to understand more than just the numbers they are producing in financial statements. Kay is an excellent teacher!

5
Anonymous Author
This course was a good overview of Financial Ratios and what to use to analyze financial statements. Some of this was a review but also had good information. The instructor was good overall.

5
Member's Profile
Instructor explained things in a way that was easy to understand and totally relateable to what I do in my job. Lots of good info without lots of unnecessary extraneous chit chat.

5
Anonymous Author
Very informative course on the Financial ratios. Which are widely used in the accounting job which i currently hold and very easy to follow with the professor teaching the course.

5
Member's Profile
Excellent coverage of this topic. The examples and illustrations complemented the lecture well. Easy to follow and understand. Would like to see more courses from this lecturer.

5
Anonymous Author
Great course, overview, and reinforcement of Financial Analysis ratio and approaches for interpreting financial statements relevant to Accounting or other Users of statements

5
Member's Profile
The presenter was well spoken, he presented the information quickly but with the right type of comparisons and examples. One of the best presentations I've viewed recently.

5
Member's Profile
Enjoyed the presentation. While I’ve used these ratios, this class will help me organize my thoughts so I can clearly communicate issues with other managers. Thank you.

5
Anonymous Author
Kay does a great job and presenting the financial ratios. I use some similar calculations for my balance sheet budget to assist in determining if the budget makes sense.

5
Member's Profile
The instructor is easy to follow and very knowledgeable. I have enrolled in her courses before. The content was informational and applicable. Very useful in the industry.

5
Member's Profile
instructor was clearly very knowledgeable, spoke quickly and used examples of how you would apply to real life situations-- a lot of material but all very useful.

4
Member's Profile
Great use of time and his notes helped alot. Just being immersed in it for that time helped to solidify concepts not used that much and reinforce those we do.

5
Anonymous Author
Solid course with solid straight forward information. Appreciate the instructor getting down to the brass tax and not getting too caught up in the weeds.

5
Member's Profile
This course is very helpful as on overview to the important analysis that needs to be done each month once the numbers are finalized from month-end close.

5
Member's Profile
A solid presentation with real examples which enhances the learning experience. Kay also speaks with enthusiasm which adds more flavor to the content.

5
Anonymous Author
Great summary of the common ratios used to measure financial performance, I appreciated the refresher and theeasy-to-follow definitions and explanations.

5
Member's Profile
Very good course on the basics of financial analysis. Appropriate for individuals who are new to this practice area or those looking for a refresher.

4
Member's Profile
The instructor made a dry subject interesting and informative. Suggest adding sample review questions after each major topic to reinforce learning.

5
Anonymous Author
Great course. THe instructor very clearly lays out learning objectives and delivers on teaching those. Great for any accountant to refresh on this

5
Anonymous Author
Financial statement analysis is an incredibly useful technique that I use in my day to day. This was helpful for refreshing on some of the basics.

5
Member's Profile
This was a very insightful course. Showing the common sized financial analysis and touching on the dupont method were both items I did not know.

5
Anonymous Author
Energetic presenter that clearly explained how to use financial ratios in different scenarios. Loved this course! I will use some of his tips.

5
Member's Profile
Agree with many of the other reviews. The presenters enthusiasm and real world examples make it far easier to really engage with the material.

5
Member's Profile
Great presentation and presenter. He is very knowledgeable and presents the concepts with clarity. Examples are meaningful and interesting.

5
Anonymous Author
I thought the course was a good, quick overview of financial statement analysis. Potential Pitfalls section at the end was a good conclusion.

5
Member's Profile
Mr.Stice has an energized and passionate presentation style that held my attention. Learned new material beyond the usual ratios. Thanks.

4
Anonymous Author
Ratios were well defined & thoroughly explained. Might have been nice to have some exercises in calculating them included in the training.

5
Member's Profile
Great job reminding us that the financials are only the first step...i don't use ratios as i should. printed out the slides to remind me.

5
Member's Profile
This is a clear and concise course giving an introduction to the uses and calculations of financial statements using ratio analysis.

5
Member's Profile
I really like the dynamics of this presentation. Even though it is a long course, it was very engaging. Lots of useful information.

5
Anonymous Author
This was a great high level overview of types of ratios to use when trying to determine leverage, efficiency, etc. Great course!

4
Anonymous Author
This is a good review of ratio analysis and how to analyze financial statements to determine the areas of concern or difference.

5
Member's Profile
Great instructor! Very knowledgeable and did more than just talk about how to calculate the ratios. He also focused on the "why"

5
Member's Profile
This is a great course. The professor used real world examples to bring clarity to the concepts. I highly recommend the course.

5
Anonymous Author
Great course which provides useful information about basic metrics that help in the process of analyzing financial statements.

4
Anonymous Author
The instructor looks at the same information from different perspectives. He is engaging and has fun presenting the material.

5
Member's Profile
The course provides great case examples of principle financial statements analysis and the purpose for the various ratios.

5
Member's Profile
This was an informative and concise course that gave good background on how to analyze and compare financial statements.

4
Anonymous Author
This was a good review of financial Ratios needed to review Financials statements. Good course to take as a refresher.

5
Member's Profile
I enjoyed this refresher of financial ratios. He does a very good job of explaining the ratios and their application.

5
Member's Profile
This is a really helpful review of ratios and analysis. Highly recommended if you haven't reviewed ratios recently.

5
Anonymous Author
Very knowledgeable instructor with presentation that covers a significant amount of material in the time allowed.

3
Anonymous Author
Refreshing and practical review of key ratios and analytic tools for better understanding a company's performance

5
Anonymous Author
Very informative and engaging discussion! I will be taking this back and applying to future analysis. Thank you!

4
Anonymous Author
This was an excellent refresher, with easy to follow examples for all the basic ratios used and then some

5
Member's Profile
I loved how the instructor used a device to draw on the screen and gave full explanations of everything.

5
Anonymous Author
the course is designed in such a way that it would give a better conceptual clarity about the topics.

5
Anonymous Author
The instructor is passionate about the subject and effectively communicated the concepts presented.

4
Anonymous Author
Very helpful look into reviewing and analyzing financial statements and not just preparing them.

5
Anonymous Author
Excellent presentation of financial ratios and how to analyze a company's financial statements.

5
Anonymous Author
very thorough. well presented. The material was presented in a way that way easy to understand

5
Anonymous Author
Analyzing Financial Statements is a great course. I learn a lot from this course. Well done!

5
Member's Profile
A quick recap on the main ratio's and what they tell about the company. A refreshing course

4
Anonymous Author
THis is a great overview/refresher providing useful tools to analyze and compare financials

4
Anonymous Author
Really good course on financial ratios and how to use them to analyze financial statements.

5
Anonymous Author
Kay did a great job with this presentation and laid out very useful information. Thank you!

5
Member's Profile
Good course. Material connected to test. Informative, well presented. Meets stated goals.

5
Member's Profile
Really common sense analysis. I really enjoyed the course and the instructor is great.

5
Anonymous Author
good review of financial statement ratio topics and methods. my thanks to the presenter.

5
Anonymous Author
Useful topic and good coverage of information on financial statement analysis and ratios.

5
Member's Profile
insightful as to when , why and how the analysis tools are used - excellent presenter !

5
Anonymous Author
Thank you Kay for your patience and your great sense of humor … i enjoyed the course

5
Anonymous Author
I really like the one the instructor presents the information. Very useful information

5
Anonymous Author
I think this course if beneficial for anyone who is in the finance area of a company

5
Anonymous Author
I enjoyed Analyzing Financial Statements (263) 4.6654 486 Enrolled2 Hours (On-Dem

5
Member's Profile
Professor Stice is engaging, energetic and made these two hours fun and informative

5
Member's Profile
This is one of the best courses I have taken. Thanks Mr. Stice, I appreicate you.

4
Member's Profile
Ratios are important indication of a business performance which is explained well.

5
Member's Profile
best instructor - enjoyed energy and clarity. apprecite examples and explanations

5
Member's Profile
This course was a great refresher on common ways to analyze financial statements.

5
Anonymous Author
On of the best course in Financial Statement Analysis. Learnt many new things.

5
Anonymous Author
Nice course. Presentation was clear and source materials were laid out well.

5
Anonymous Author
Instructor was easy to listen to and effective. Slides were easy to follow.

5
Member's Profile
good course on financial statement analysis and will help most practitioners

5
Anonymous Author
Very informative overview of various financial ratios. Effective instructor.

5
Member's Profile
Instructor is effective at delivering the concepts and is also entertaining

4
Anonymous Author
Really good refresher of several of the more common ratios and their usage.

5
Anonymous Author
Clear concise and made accounting interesting. Really enjoyed this lecture.

5
Anonymous Author
!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

4
Member's Profile
Good course but an awful lot of emphasis on DuPont ratios and computations

5
Member's Profile
Excellent Presentation! Thank you very much. This will help me a lot.

3
Member's Profile
Very informative course explaining role of ratios and financial analysis

4
Anonymous Author
A easy to follow explanation of ratios and analysis! Excellent speaker!

5
Member's Profile
Good instructor. Good review of ratio analysis and financial statements.

5
Anonymous Author
Well presented and well explained. And he made it interesting as well!

5
Anonymous Author
I would recommend this course to any CPA working on their CPE credits.

5
Member's Profile
Good information covered in the course around financial statements.

5
Anonymous Author
Great course, good review of the basics, good powerpoint materials

5
Member's Profile
Loved the Professor... he is clearly passionate about the subject!

4
Member's Profile
Excellent presenter. Demonstrates the power of ratio analysis.

5
Member's Profile
I think this course was great and would recommend it to anyone.

5
Member's Profile
Easy to follow, materials are basic and easy to understand.

5
Anonymous Author
Great lecture by the professor, very insightful and engaging.

5
Member's Profile
This course is very good for understanding Financial Ratios.

5
Member's Profile
Very helpful presentation of financial statement analysis.

5
Anonymous Author
great class. I have enjoyed all of your accounting classes.

5
Member's Profile
Excellent course for ratio analysis, very well presented

5
Anonymous Author
very nice course nice nice nice nice nice nice nice nice

3
Anonymous Author
11111111111111111111111111111111111111111111111111111111

5
Anonymous Author
The speaker gave an informative review about the course.

5
Member's Profile
a great introduction to analyzing financial statements

5
Member's Profile
Love the professors presentation style Good content.

5
Anonymous Author
Course was well developed, structured, and presented.

5
Member's Profile
The course was great. Would definitely recommend it!

5
Anonymous Author
GREAT COURSE, PACKED WITH INFORMATION AND EXAMPLES

5
Member's Profile
excellent presentation of an otherwise dry course

5
Anonymous Author
Excellent course and very effective presentation

5
Member's Profile
Very good explanations. He kept it interesting.

4
Member's Profile
Good basic course on financial statements.

4
Member's Profile
Good overview of common financial ratios

5
Anonymous Author
Nicely done, concise but thorough.

4
Anonymous Author
nice review course.

5
Member's Profile
Very good course

Prerequisites
Course Complexity: Foundational

No Advanced Preparation or Prerequisites are needed for this course. 

Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
Course Syllabus
INTRODUCTION And OVERVIEW
Widely Used Ratios
  Widely Used Financial Ratios 12:39
  Widely Used Financial Ratios (Continued)12:02
Common-Size Statements
  Common-Size Financial Statements 9:05
  Common-Size Financial Statements (Continued)10:49
DuPont Framework, Analysis, and Ratios
  DuPont Framework 11:47
  Additional Analysis11:53
  Efficiency Ratios10:22
  Leverage Ratios 10:21
  Cash Flow Ratios12:13
CONCLUSION
  Potential Pitfalls 6:54
Continuous Play
  The Need for Financial Statement Analysis1:57:46
SUPPORTING MATERIALS
  Slides: Analyzing Financial StatementsPDF
  Analyzing Financial Statements Glossary/IndexPDF
REVIEW and TEST
  REVIEW QUESTIONSquiz
 FINAL EXAMexam