Introduction
Financial ratios are essential tools for understanding a company’s financial health, operational efficiency, profitability, and long-term sustainability. However, financial statements contain more than just numbers; they reveal the story behind a business’s performance, management decisions, and future potential. This topic introduces the fundamentals of financial ratio analysis, beginning with how to decode financial statements before exploring five important categories: profitability, liquidity, efficiency, leverage, and valuation ratios. Through practical business examples, participants will learn how to interpret financial information, identify potential financial risks, evaluate business performance, and make informed investment and management decisions. Ultimately, financial ratio analysis transforms complex financial data into meaningful insights that support better business strategies and sustainable growth.