Abstract
In this article the de facto use of financial ratios is reported on. To identify meaningful financial ratios, information was obtained from 166 enterprises on the use of financial ratios. The Likert scale was used to establish the frequency of use of the following categories of financial ratios, namely return on assets, income margins, capital turnover, solvency and ratios derived from the cash flow statement. In total, 41 financial ratios were submitted to the respondents. The most important findings were: Income margins are by far the group ratios with the highest frequency of use along with the debtors collection period. Further, with the help of a multiple analysis of variance, it was established that the main activities and size of respondents had no influence on the use of specific categories of financial ratios. Finally, the findings of a factor analysis indicated noticeable similarities between theoretical groupings of financial ratios and the results of the empirical study.
Highlights
The Liken scale was used to establish the frequency of use of the following categories of financial ratios, namely return on assets, income margins, capital turnover, solvency and ratios derived from the cash flow statement
With the help of a multiple analysis of variance, it was established that the main activities and size of respondents had no influence on the use of specific categories of financial ratios
Final-year students in Financial Management of the University of Port Elizabeth administered the questionnaire canvassing the opinions of business management on the use of financial ratios
Summary
-2 aktiwiteite van die respondente (vervaardiging en dienslewering) en grooue (beoordeel volgens batewaardes, verkoopsinkomste en aantal werknemers). Die afbanlc.like veranderlikes is in die reeds genoemde ses lc.ategoriee verhoudingsgetalle saamgevat. By die meervoudige analise van variansie word die verwantskappe tussen die onafhanlc.like (gesamentlik) en afhanlc.like veranderlikes met behulp van F-toetse ondersoek. Die p-waardes wat verlc.ry is, word by die hipotesetoetsing gebruik: indien p < 0.05, dan bestaan daar statisties beduidende verwantslc.appe tussen die veranderlikes. Die berelc.ende p-waardes verskyn in Tabel 5, bereken v.ir label 4C Rangorde van respondente vanuit die tersiAre sektor (N=43). K~ffisit!nt Rangorde venkil Rangorde ventil van variasie met algeheel met primere en se.kondere sektore (Tlbel 48)
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