Financial Analysis And Evaluation Of JiLin Power Share Co.Ltd.

Financial analysis is generally known as financial statement analysis. Because the financial analysis rests on the main material originating from the financial statement, and many indicators of financial analysis are revealed through the relationship between the interrelated items in the financial statements. Therefore, the financial analysis and the evaluation are according to each data which enterprises' finance reports reflect, has key performs to analyze and the inspection one by one target-oriented, in order to makes the correct judgment about enterprise's financial situation, the managing finances process and the management performance, to provide the basis for the enterprise decision-making.Enterprise finance analysis's object is each kind of economic relationships which the finance report form and reflect, includes, profit and loss account, The statement of changes in financial position and their attached list and the economic relationships which specifically reflect. The enterprise finance management is basically content of collection and utilized the income and the assignment of the business capital, the financial relations adjustment and so on. Financial analyses of the enterprise focus on the enterprise solvency, sales profits and the use of funds effects, etc. Inspect the occupied, consuming and earning conditions under the performances of the value of enterprise's human resources, finances and properties.To analyze Jilin Power Share Co. Ltd. by the following aspects: (1) the analysis and evaluation about the solvency of enterprise. Here one is to analyze the solvency which the profit and loss accounts reflect; Second, to analysis this through balance sheets. (2) Evaluation of the profitability of enterprises. Although in the business economic benefit indicators system, the profit target occupies the main status, adapting with this, the financial analysis and evaluation should take profit ability analysis as centers. (3) The evaluation of the efficiency in the use of corporate assets. Hope that through the above analysis of the company's operating conditions, to promulgate some questions which the company's management exists, for investors, creditors, as well as the management, and other users of financial information to make the right decision for reference.Jilin Power Share Co. Ltd. is the analysis of this study. The company's financial data come from their respective 2002-2006 annual reports which can be found from the Financial Sina website (http://finance.sina.com.cn). Comparing data from the Financial Industry website (datacenter.jrj.com.cn), and other securities industry related sites. Ratio analysis, comparative analysis, trend analysis have taken as the methods during the financial analysis. 2002 - 2006 financial sheets of the company were carried on the analysis.This article expounded with the beginning of the financial analysis based on the basic theory. Then in view of the company 2002 - 2006 financial statements, to assess the company's profitability, solvency and the ability to grow, as well as cash flow situation . Using the DuPont financial analysis to give a synthetic evaluation of company 2004-2006 financial situation, pointed out that currently existing problems and gave some reasonable proposals.1. Companies should adjust its capital structure; increase the proportion of long-term liabilities. Make full use of financial leverage to enable the company to achieve the shareholder rights and interests maximization. The company's assets liabilities in late 2006 was only 10.52%, and the low ratio of debt to net worth enabled the company to have fast development ability with the effect of financial leverage in the short time. If improve the company's assets and liabilities rate, the company's rate of return on equity will be greatly enhanced, and shareholders will obtain more dividends.2. Expand the running scale, enhance market competitiveness. The assets, income, the installed capacity of electricity of Jilin Power Share Co. Ltd. are in the position after the electric power tectonic plate. Currently, the controlled power installed capacity of Jilin Power Share Co. Ltd. in the main listed companies is a relatively smaller and smaller scale of the assets may face marginalization of the capital market situation. So, Extending controlled expand capacity of Jilin Power Share Co. Ltd. will be beneficial to increasing the comprehensive strength.3. Strictly control production costs. Since China's implementation of the Government's administrative power price controls, the price cannot be adjusted according to market supply and demand relation, furthermore, cannot with the rise in the cost of generating electricity price to increase them. If coal prices continue higher, the company operating costs will rise and face the threat of decreased efficiency, strictly control the cost of production is a pressing task.4. For Jilin Power Share Co. Ltd. is the flagship enterprise Jilin Province and the capital market financing platform, China Power Investment Corporation will support its development positively, and Jilin Province's high quality assets will prior to pour into it. At present, the current generation assets of Jilin Power Share Co. Ltd. and the affiliated power generation company under the actual control of major shareholders and other people form a certain level of the industry competition and affiliated transactions. Through the integration of assets, the overall capital market, which means the operation can be effectively solved the above issues, and further on to promote corporate governance, enhance management strength, improve management efficiency, and establish a sound social image.5. Highly centralized management model. Power products from the power generation, transmission and distribution require a high degree of coordination, without the inherent characteristics of the storage, must take the efficient allocation of resources and unified control. The financial management of the power industry influenced by these characteristics should be required to centralized management. With strengthening communications among the main body of each management accounting, the scope of business and financial data of geographically dispersed company can be within centralized processing.