Abstract

The main purpose of this study is to apply a detailed financial ratio analysis on the firms that have declared concordat, to determine which kind of financial ratios predict the more successful preliminary estimations and to form a model according to the findings obtained and to apply this model to the firms operating in Borsa Istanbul construction sector. For this purpose, the last 5 years' financial statements of the two companies whose shares are traded on Borsa Istanbul and declared concordat are analyzed by the ratio analysis method. As a result of the analysis, it was found out that the ratios that gave the strongest concordat signal are the liquidity and financial structure ratios. According to the results of the analysis, a model that can be used for the general of the companies is proposed by giving weight to each rate type. In order to test these findings, the model is applied to the financial statements of three companies operating in Borsa Istanbul construction sector and financial ratio scores of firms are calculated over the years. According to the results of the analysis, it is found that the financial situation of the construction firms is much better than the ones of the firms that has declared concordat. However, when the construction firms are compared with each other, it can be stated that YYAPI is lagging behind others in terms of financial performance.

Highlights

  • The financial statements issued by the firms have vital importance for the information users during the decision-making process

  • Financial performance analysis includes the calculation of activity and financial performance indicators, determination of financial position of firms and measurement of the efficiency and risks of investments made based on historical financial statement information of a company and form the basis for the financial projection to be made for the years (Gümüş et al, 2017)

  • The results of the analysis showed that both leverage ratio and return on equity ratio are he important financial factors that protect firms from bankruptcy or financial turbulence

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Summary

Introduction

The financial statements issued by the firms have vital importance for the information users during the decision-making process. Financial performance analysis includes the calculation of activity and financial performance indicators, determination of financial position of firms and measurement of the efficiency and risks of investments made based on historical financial statement information of a company and form the basis for the financial projection to be made for the years (Gümüş et al, 2017). The benefits of financial analysis and the information users they serve are summarized in the table 1 below: It provides crucial information Covers both Internal (Managing about the company's business Partners) and External This rate is used especially for calculating the payback period of the money provided by the shareholders Explanation It shows how many times the firm can collect its trade receivables from its customers during a fiscal year. They divided the sample into groups and applied discriminant and clustering analysis

Literature Review
Sample Construction and Methodology
Financial Analysis and Model Construction
Findings
Conclusion and Recommendations
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