The monetary position of Understand Your Network And Let Knowledge Flow Financial Analysis can be examined by taking a look at its ratio analysis.
We can see in appendix 1 how the earnings has been declining throughout the years after 2005. The truth that the gross profit margin has actually reduced as well recommends that the expense of sales have not gone down at the exact same pace. The declining internet success, showing a negative trend from 2006 to 2007 suggests that costs have actually increased far more than the company is able to handle provided its present resources. With a long term debt adding to the interest cost, Understand Your Network And Let Knowledge Flow Financial Analysis is in dire requirement of an alternative profits stream.
We can see a major decreasing trend in the current ratio too showing a fall in liquidity which is another point of concern for Understand Your Network And Let Knowledge Flow Financial Analysis especially as it has a long term debt to pay off as well. With the present assets not in a position to settle the existing liabilities, we can see how the business would be in a significant monetary difficulty unless the cash flow improves with extra sources of finance.
We could check out the financial condition of Understand Your Network And Let Knowledge Flow Financial Analysis further by taking a look at the business's overall debt to total properties ratio in appendix 2. We can see how the overall assets of the business have been declining from 2005 onwards. The long term financial obligation has actually remained at $160 million while the short term debt has actually increased side by side. Such a scenario has brought Understand Your Network And Let Knowledge Flow Financial Analysis to a point where its overall financial obligation to total properties ratio has increased too. A rising overall financial obligation to total properties ratio suggests that the risk has increased in terms of the business's properties not sufficing to cover its total liabilities. This might not be showing the total liquidity position however offers clearness in terms of the total monetary position of the company.