| February 2007, economic crisis that was set off by the U.S. subprime mortgage crisis led to global liquidity risk business expanding rapidly. Many companies owing high profit declare bankrupt or collapse suddenly in a relatively short period of time. A very important reason is that the book profit has not enough cash flow as a support. The existence of these factors make the enterprise investors, the creditors as well as the collectivity and individual which have benefit relations with the company,even more pay attention to the information about the ability of paying off a debt and profiting and management process and so on. But the traditional financial analysis index system based on the balance sheet and profit statement, as well as "accountant profit" as core. It overlooks cash flow information. So inodrer to master the listed enteprises'condition of performance and finance exactly in good time, the managers and investors have to do financial analysis through accounting information. In addition, on February 15,2006, ministry of finance had promulgated the new accounting standards which included a basic standard and 38 concrete standards. On January 1,2007, it has been implemented in listed companies. The new accounting standards change greatly in the concept of property, income, income viewpoint, confirmation and measurement of profit, as well as financial reporting and so on. These changes are bound to have serious impact on in the past financial analysis index system. Therefore, it seems to be especially important to build a comprehensive and systemic financial indexe system.By reviewing traditional financial index system and combining with the current characteristics of China's real estate industry, development status and our government issues new policies for the real estate, this article analyses the imperfect and its bad influences of existing financial index system, and then introduces index system based on cash flow. It' analysis can be further mainly divided into analysis of profiting ability, debt-repaying ability, operating ability and growth ability. And introductiong these into the financial warning can be used in the comparing the defect of traditional financial index system with advantage of index system based on cash flow.The last is a case. By comparing the case, the article draws the following conclusion:(1) the new financial analysis index system is more objective and more reliable than the tradition financial analysis index system; (2) it is essential to pay great attention to the cash flow analysis when carring on the business finance analysis; (3) financial indicators based on cash flow system and the traditional financial indicators reflect different levels of information systems, and so the two have highly complementary. |
