Ratical Analysis: Financial Analysis Of British Airways

To analysis financial statements there are various tools. Ratio analysis is one of them. In ratio analysis we establish relationship between two or more items of financial statements and derive some vital information about the business.

Ratio analysis are useful tools when judging the performance of a company by weighing and evaluating the operating performance (Block-Hirt). There are 13 significant ratios that can separate by four main categories,

the period a journalist for the Financial Times noted "British Airways has become the first

British Airways (BA) is the flag carrier airline of the United Kingdom, based in Waterside, near its main hub at London Heathrow Airport. It is the largest airline in the UK based on fleet size, international flights and international destinations and second largest measured by passengers carried, behind easyJet.

British Airways came into existence since civil aviation began shortly after World War I. A lot has changed in the 90 years from the world's first schedule air service on 25 August 1919 to the present day civil air travel. Every 10 years since civil aviation began. The world has seen changes in the types of planes that have been in service to the speed of sound air travel as well as developments and changes to the business in all aspects of all areas. It is this that has paved the way that British Airways do business and will carry on perfecting and tweaking its service so passengers

The financial condition of an organization represents the strategy and structure. However, the use of ratios an individual can assess a company’s abilities to function and grow in an highly competitive market. The ratios and financial statement can be complex, however, financial performance of the organization can be acquired with the execution of performing these ratios from the balance sheets and statements. Most common groups to perform these anglicizes are profit ratios, liquidity ratios, activity ratios, leverage ratios, and shareholder-return ratios. With evaluating the organizations performance, these ratios are compared to the industry average over the history of the firm. When these calculation and ration reveal a deviation

British Airways is one of the largest airlines in the United Kingdom. It is one of the largest in terms of fleet size and also the airlines they have. The main place from where they do their business is London where they participate from Heathrow, Gatwick and London city airports. They are also expanding their schedule to travel from Stansted, Manchester, Birmingham and Bristol airports. http://www.iairgroup.com/phoenix.zhtml%3Fc%3D240949%26p%3Daboutoverview.

British Airline PLC (BA) is the largest international airline that operates out of the Heathrow airport in London. The company recently merged Iberia which was initially proposed in 2009 and was approved by the European Commission in 2010. A new organization was created known as International Airlines Group (IAG) which is the world's third largest airline in regards to total revenue as well as the second largest airline group in Europe. British Airways was the creator of the Oneworld airline alliance in which it has formed a strategic partnership with other industry players such as American Airlines in the U.S. and Qantas Airlines in Australia. Given the size and breadth of the company, a stakeholder analysis must cover a lot of ground. This analysis will look at the different groups of stakeholders that are concerned with the performance of this organization.

Ratio analysis are useful tools when judging the performance of a company by weighing and evaluating the operating performance (Block-Hirt). There are 13 significant ratios that can separate by four main categories,

British Airways is currently the largest international scheduled airline in the United Kingdom. It was a founding member of the Oneworld alliance with Cathy Pacific, American Airlines, and Qantas. This British air transport company was formed in 1974, merging from two nationalized airline corporations, British Overseas Airways Corporation and British European Airways, plus two regional airline companies, Cambrian Airways, and Northeast Airlines. After being a state-owned airline company for the following thirteen years, it was privatized in

Financial ratios are calculation of numbers from the financial statements for a comparative analysis. A ratio in and of itself has little meaning but as a tool of comparison, internally, it reflects the company’s performance year to year, or externally comparing other organizations’ performance within the same industry. Ratios help to determine the company’s strengths, weakness, and risk. Credit analysis and investors also rely heavily on ratios (Baker & Baker, 2014).

British Airways is the one of the largest airline companies, and the passengers carry overall in the fifth largest in the world. Most of plans are stay in Heathrow Airport which is the highest of main international airport. The British Airways has a long history and airlines cover 133 countries; include 373 airplanes. The BA Company includes 50,086 workers to be in the service, which is one of the largest employers and employees in the United Kingdom.

The calculation of ratios is the calculation technique for analyzing a company’s financial performance that divides or standardize one accounting measure by another economically relevant measure. Financial ratios can be used as a tool to demonstrate financial statement users for making valid comparisons of firm operating performance, over time for the same firm and between comparable companies. External investors are mostly interested in gaining insights about a firm’s profitability, asset management, liquidity, and solvency.

Ratio analysis is generally used by the company to provide some information on how the company has performed during that year, so that the parties involved including shareholders, lenders, investors, government and other users could make some analysis before making any further decision towards that particular company. As mentioned by Gibson (1982a cited in British Accounting Review, 2002 pg. 290) where he believes that the use of ratio analysis is such an effective tool to evaluate the company’s finance, and to predict its future financial state. Ratios are simply divided in several categories; these are the profitability, liquidity, efficiency and gearing.

Ratio Analysis is a powerful tool of financial analysis. The absolute figures that are reported in the financial statements do not provide an understanding of the financial well-being of the firm. Ratios help in creating a qualitative judgement about the financial position of the company by making use of quantitative relationships. The standards of comparison of the ratios involve comparing them with: