Ratios merely direct an analyst to potential areas of concern and it does not provide conclusive evidence as to the existence of a problem.

Question

Quizplus · Accepted Answer

Ratios are tools that offer a way to quickly compare and evaluate financial information. However, they only indicate potential issues and do not provide conclusive evidence of problems. Further analysis and investigation are necessary to confirm the existence of a problem.

Ratios Merely Direct an Analyst to Potential Areas of Concern