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Briefly describe five limitations of financial statement analysis.

Auditing: A Risk Based-Approach to Conducting a Quality Audit

10th Edition

ISBN:9781305080577

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter17: Other Services Provided By Audit Firms

Section: Chapter Questions

Problem 55RSCQ

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Briefly describe five limitations of financial statement analysis.

Expert Solution

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Financial statement analysis is a process made for analysing the financial statements of the company to make some useful decisions. The users of financial statements are investors, employees, creditors, government and owners.

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