CHAPTER 7

The Stakeholder Perspective to Financial Statements Analysis

The DuPont analysis that has largely been the focus of this book looks at financial statements from the perspective of the equity holder. This framework is not the only way to study financial statements, nor is it always required. While this is a comprehensive approach and broadly combines the lookout for all stakeholders of a firm, some stakeholders may do well to just focus on part of this framework. We will look at some key stakeholders as examples to understand how portions of this framework can be pieced out by them to suit their purposes.

DuPont Framework for the Lender

A lender is normally interested in the due servicing of his debt—timely principal repayments and timely ...

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