The effect of analysis using financial ratios in improving the quality of financial reports

Abstract

The aim of the study was to demonstrate the impact of analysis using financial ratios in improving the quality of financial reports. To achieve the purpose of the study, a questionnaire was prepared consisting of (36) questions, including (28) questions to measure the independent variable (financial ratios) and (8) questions to measure the dependent variable (improving the quality of financial reports). The questionnaire was distributed electronically, and (47) questionnaires were obtained of the respondents' responses, all of them were subjected to analysis, and a linear regression test was used to test the hypotheses. The study reached several results, including There is a statistically significant effect of the analysis using financial ratios as a whole in improving the quality of financial reports. There was also a significant effect of analyzing using financial ratios separately (capital structure ratios, profitability ratios, liquidity ratios, turnover ratios, and market ratios) in improving the quality of financial reports. The study also found a set of recommendations, including the need for responsible authorities: to explain the importance of using financial analysis methods through financial ratios to evaluate the performance of enterprises and identify their strengths and weaknesses. And the need to conduct appropriate training and courses for workers in using financial analysis methods in general and analysis using ratios in particular because It has a role in improving the quality of financial reports.