A Comparative Financial Statement Analysis Of Petro China And ExxonMobil-An Outlook Of Petro China Based On The Current Economy Downturn

Financial statement analysis of a company can reflect and evaluate the company's basic financial position,operating results and cash flow position during a particular period of time.Accurate usage and understanding of information from the financial statements will help assist in familiarizing with the company's past situation, evaluating of the current condition and grasping hold of its future operations. Accurate financial records are necessary to keep track of financial warning signals such as inordinately high expenses,high levels of debt or a poor record of collecting bills.Public companies often have specific procedures for gathering,verifying and reporting financial information.This paper has selected listed company-PetroChina Co.Ltd.(hereinafter referred to as PTR) as the company for case study analysis,while using ExxonMobil Corp.'s Financial statements as a comparison,and PTR's financial situation is then analyzed,with suggestions put forward.Oil,being a strategic resource is a key factor that has an effect on the social and economic developments and also a nation's security.In recent years,China's crude oil imports have been increasing and the differences between the supply and demand of crude oil is amplifying.This issue has become one of the main bottlenecks restricting China's social and economic development and as one of the largest oil company in China,PTR should protect the security of China's oil safety.Hence,a good financial statements analysis will help reflect on PTR's performances,providing investors and potential investors from different markets with a sound analysis.PTR was famed as one of "Asia's most profitable companies" for consecutively five years period.But this paper,from a secondary user point of view on financial statements,made used of Dupont Analysis,financial ratios,credit capacities,cash flow cycles etc.to carry out this study and has discovered that PTR have several segments that are relatively weaker(as compared to the world's biggest petroleum company,ExxonMobil Corp.) is that,under weak profit growth circumstances,assets expansion is relatively big as overall business efficiency stays low.Moreover,with PTR's short-term credit capacity being inadequate,it shows that PTR may not be making full use of financial leverage.Following,suggestions to issues that PTR should look out for will be discussed.Lastly,due to limitations faced during the research and analysis process, financial data are obtained via open media may face inaccuracies up to a certain extent.