Content of Business Performance Analysis in Enterprises.

The comparative method serves as the basis for using other methods to determine the influence of quantitative factors on the analytical index.

Comparison principle:

Selecting the standard for comparison: The comparison standard is the index chosen as the basis for comparison, called the base period for comparison. Depending on the research purpose, choose an appropriate base period for comparison. The bases for comparison can be: The performance of a past business period, the planned index of a business period, the index of enterprises in the same industry, same region,...

The period indicators selected for comparison with the base period are called period performance indicators and are the achieved business results.

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Comparison conditions:

For this method to be meaningful, the prerequisite is that the indicators used in the comparison must be consistent. In practice, we need to pay attention to both the time and space of the indicators and the conditions under which economic indicators can be compared.

About time: These are indicators calculated within the same accounting period and must be consistent on the following 3 aspects:

o Must reflect the same economic content.

o The indicators must use the same calculation method.

o Must have the same unit of measurement for both data, time and value.

In terms of space: The criteria for analysis must be converted to the same scale and similar business conditions.

Comparative techniques: To meet research objectives, people often use the following comparative techniques:

Compare by absolute numbers:

o Absolute number is the number that represents the scale and volume of a certain economic indicator, we often call it the value of the economic indicator. It is the basis for calculating other types of data.

o Absolute numerical comparison is the comparison between the value of economic indicators of the analyzed period and the base period. The comparison results show the changes in volume and scale of economic phenomena.

 Formula : Relative volatility = analysis period index - base period index

Comparison by relative numbers: There are many types of relative numbers, depending on the analysis requirements, use them appropriately.

o Relative number: Is the result of dividing the value of the analysis period compared to the base period of economic indicators. It reflects the plan completion rate of the economic indicator.

 Formula : Relative number of plan completions = analysis period target / base period target * 100%

 Formula: Growth rate = (analysis period indicator - base period indicator) / base period indicator * 100%

The ratio of the absolute difference compared to the base period indicator to indicate the growth rate of the analyzed indicator.

1.3. Continuous replacement method.

Concept:is a method in which factors are replaced in a certain order to accurately determine their level of influence on the indicators to be analyzed (analysis objects) by fixing other factors in each replacement. 3

Location and effects of the method:

Concatenation is the continuous inheritance of data. This method is used to study synthetic economic indicators influenced by many factors that are related to each other and expressed in the form of a product or quotient.

Using this method allows to determine the specific influence of each factor, so proposing measures to promote strengths or overcome weaknesses is very specific.

3. Master Nguyen Tan Binh (2006), Textbook on business performance analysis, Statistical Publishing House, Hanoi, page 20

Contents of the method:

o Step 1: Determine the object to be analyzed, the difference in the analyzed period's indicators compared to the base period, the number of influencing factors, their relationship with the analyzed indicators to determine the indicator calculation formula. Depending on the data conditions and analysis requirements, the number of influencing factors can be calculated differently, and the expression formula can be different.

o Step 2: Arrange the factors in the formula to ensure compliance with a certain order, quantity factors come first, quality factors come after, arrange the main factor before the secondary factor.

o Step 3: Perform substitution to determine the influence of each factor.

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Substitution rule: When studying the influence of a factor, we let that factor take the value of the research period and fix it; the factor before it in the research period and the factor after it in the base period, the influence of that factor on the main analysis index is equal to the difference between the number of times this factor is replaced and the previous replacement or the base period data if it is the first replacement. Each time we replace, we only replace one factor, we replace as many factors as there are times.

o Step 4: Synthesize the effects of the factors compared with the general increase and decrease of the object and draw conclusions.

2. Source of analysis documents.

When conducting business analysis, it is necessary to collect documents such as balance sheets, business performance reports, financial statement explanations, reports evaluating the business's performance and development orientation over the years of operation, etc.

Balance sheet:is a financial statement that describes the financial status of a business at a certain point in time. The balance sheet is very important to all parties involved in ownership, business and business management. Normally, the balance sheet is presented in the form of a balance sheet using accounting account numbers. One side reflects the assets, the other side reflects the capital of the business.

Business performance report:is a financial report. Based on revenue and expenses, it is possible to determine the business results, indicating the profit or loss of the enterprise. Thus, the business performance report reflects the business results, the financial situation of the enterprise in a certain period, providing potential information about capital, labor, technology, and management level of the enterprise.

Financial statement notes:Providing data and information for more specific and detailed analysis and assessment of the situation of expenses, income, business performance, increase and decrease of fixed assets, increase and decrease of capital, etc. Through the explanation of financial statements, we can know the accounting regime applied at the enterprise.

III. CONTENT OF ANALYSIS OF BUSINESS ACTIVITIES IN ENTERPRISES.

1. General analysis of the business performance of the enterprise.

1.1. General analysis of business revenue.

The entire operation of a business includes business activities, financial activities and other activities, the main business activities of the business include production and sales. These activities all bring revenue to the business. However, through practical research and based on the main business activities of the company, it is found that revenue from sales and service provision accounts for a large proportion and is the main issue that needs to be included in the analysis.

Consumption of products, goods and services is the process of bringing goods to consumers through the form of purchase and sale. For businesses, consumption of goods is the final stage of a capital circulation cycle, the process of converting assets from physical form to monetary form. This is an important process that contributes to generating the main revenue for businesses.

Concept of sales revenue and service provision:

Sales and service revenue: is the total amount of money received or to be received from transactions and revenue-generating activities such as selling products and goods, providing services to customers in a certain period of time.

Net revenue = Sales revenue – deductions

Deductions include:

- Sales discount

- Discount on sales

- Returned goods

- Tax (special consumption, export, VAT)

The role of revenue for business:

Revenue is vital to a business, being the final link in circulation.

Revenue helps businesses offset costs, recover capital, and realize surplus value.

Revenue shows the ability and strength of a business in expanding the market.

Increasing revenue is a fundamental measure to increase business profits, enhance reputation and market dominance of the business.

The task of revenue analysis in business:

Revenue analysis helps us see clearly the total revenue in the business period as well as the net revenue of the enterprise.

Through analysis reflecting fluctuations in business results of the enterprise, within and between business periods, thereby reflecting business reputation and reflecting the level of market dominance of the enterprise.

Specify and measure the impact of factors on revenue and revenue fluctuations between periods.

Analyzing revenue performance is the basis for developing revenue planning indicators, revenue structure or business plans as well as helping to establish other economic indicators.

Content of sales and service revenue analysis.

General analysis of sales and service revenue.

Through the analysis of sales revenue and service provision, businesses can grasp specific fluctuations in revenue over many years, thereby making accurate comments on business quality as well as business trends in the future.

Long-term planning. Determine the role and position of the business in the market over a long period of time.

Analysis method: - Compare revenue over business periods

- Compare revenue with businesses in the same industry

revenue scale, speed.

Analyze revenue situation according to arising economic transactions.

Helps businesses grasp the structure and fluctuations of revenue according to each economic activity, specifically the situation of domestic and export product consumption. Thereby, determining the role of each activity, the importance of each market, predicting the potential of the markets to set revenue and profit targets as well as measures to achieve those targets.

1.2. General analysis of business costs.

Business cost concept.

Costs in general are the expenditure expressed in money incurred in the business process with the desire to bring about a completed product or a certain business result.

Cost classification:

Costs arise in production, trade and service activities to achieve the ultimate goal of revenue and profit. However, costs are divided according to many different criteria. To facilitate the analysis of business activities, the article classifies business operating costs according to cost content.

Direct material cost

Production costs

Direct labor costs

General manufacturing costs

Cost of sales

Non-manufacturing costs

Business management costs

Diagram 1: Classification of business costs by cost content.

Concept of cost ratio:Cost ratio or cost ratio shows how much cost is needed to generate one dollar of revenue.

Total costs often vary with the volume of activity, but the cost ratio is usually stable or fluctuates very little over time. Therefore, this is a typical quality indicator used as a measure of effectiveness in cost management.

The reduction in the fee rate over the business period is a good thing, however, the conditions that come with it must be the continuous growth of revenue, maintaining the reputation of the business, the quality of goods, and fulfilling the business's obligations to the State and society. Therefore, businesses need to manage the fee rate or in other words, manage business costs reasonably.

The meaning of reasonable business cost management.

For businesses, reasonable management of business costs contributes to creating conditions for businesses to achieve profit and business efficiency goals, helping businesses improve competitiveness, enhance reputation in the market, create prestige with employees, customers, partners and increase the ability to

investment in the future

Reasonable cost reduction allows businesses to increase profits, thereby ensuring better living conditions for workers such as stability, creating new jobs, increasing salaries and bonuses, and improving social welfare.

Business cost analysis task.

Accurately and promptly reflect business costs incurred and allocated in the business line or cost fluctuations during the business process.

Identify factors affecting business cost management, recognize which factors have good and bad impacts.

Propose reasonable business cost management solutions.

General analysis of business costs of the enterprise.

General analysis of business costs of an enterprise is based on accurate collection of data on business costs, grasping the indicators in cost analysis.

Business costs. Through the analysis and assessment of the general situation of fluctuations in business costs and the quality of business costs, the ability to manage all business costs of the enterprise. On that basis, the direction for specific and detailed analysis for the next analysis steps.

Analysis method:

 Absolute difference in costs between periods

 CF = CF 1 - CF 0

 Periodic cost ratio (%) T sf = CF/DT

 Tsf imbalance

 T sf = T sf1 - T sf0

 Rate of increase or decrease in fee rate (%)

%  T sf =  T sf / T sf0

 Savings or overspending level: is the difference between actual implementation costs and implementation costs based on the ratio of planned costs to actual revenue.

U =  T sf *DT 1

1.3. General analysis of the business's profit situation.

Concept of profit: Profit is the final financial result of production and business activities of goods and services. It is a quality indicator to evaluate the economic efficiency of business activities.

LN = DT – CF

- Gross profit = Net revenue – Sales revenue

- Net profit = LNG – (CFBH + CFQL)

- Profit after tax = LNT - corporate income tax Profit includes 3 parts:

o Profit from sales and service provision: the amount of profit earned from the main business activities of the enterprise, in this case, sales and service provision.

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