Research About The Use Of Polar Diagram In Financial Generalized Analysis

As for generalized financial analysis method, Wall Marking Way and The Du Pont Financial Analysis have been widely used both in our country and abroad. Wall Marking Way and the Du Pont Financial Analysis these two methods have prominent merits, but also have its flaws. How a new financial analysis model can absorb its merits and simultaneously avoid its shortcoming is the difficulty and key which this article studies. The polar diagram originally is one kind of method which has been used to choose superior project method. As a choosing superior project method, it has merits such as direct-viewing, easy to judge and so on. The polar diagram has been used as a financial analysis method in this article, it has been transformed to be one finance generalized analysis method. Transformation process as follows: Change evaluating projects into evaluating enterprises'financial condition ;change the itemized appraisal attribute in the traditional polar diagram into the financial norm; according to the target weight determine the ratio line's angle, reference the basic circle's total area standardize the area of polygon , then the standardized area of polygon coordinates with various enterprises'financial condition, at last produces a final grade of the enterprise's financial condition.Wall Marking Way and the Du Pont Financial Analysis are two extremely typical analysis methods, the new model must absorb their merits, then can be one scientific and reasonable method. The new model first absorbs the merit of interdependence between various targets in the Du Pont analytic method, taking EVA as the core establish a set of new comprehensive financial norm system reflecting enterprises'finance conditions, use AHP to dispose weight to the chosen financial norm, then obtain a grade. Thus the new model has the merits of both Wall Marking Way and the Du Pont Financial Analysis, it operates easily, obtains simple result. The result is direct-viewing and advantageous to discover the disparity between the enterprise and the profession. The new model has made the objective evaluation to the enterprise's overall financial condition.Practices proved the new model has the actual value, but this model also has its own flaw, for instance in this model few finance norm reflected cash flow, therefore this model still has much to improve.