The study of economic processes, their analysis allows not only to draw conclusions about their current state, but also to predict development in the planning period. To do this, financial managers use many methodologies. One of the simplest and most often used is a method that uses relative indicators. They allow you to compare several values, find their share of influence in the overall process, and also purposefully conduct optimization of the object under study.
Without an assessment of relative indicators, financial and economic analysis is unthinkable.
general characteristics
Relative and absolute indicators are closely related. The analysis should examine each type of quantity.
Absolute indicators always have units. Relative indicators reflect the measure of the ratio between absolute values. This is a mathematical division of (often two) features that express the value of one or two factors.
A very important quality that makes relative values so popular in the analysis is their ability to abstract from calculations of differences in absolute values. At the same time, indicators can be looked at from the other side.
Absolute and relative indicators are inextricably linked, and to assess the financial and economic processes should be applied in combination.
Calculation formula
The calculation of relative indicators is carried out according to a certain formula. Its general appearance is as follows:
- OP = absolute current (compared) indicator / absolute base indicator.
The relative indicator, the formula of which is given above, can have the same name of absolute indicators in the numerator and in the denominator. The result in this case can be measured in the form of a coefficient, percent, ppm, etc.
If the absolute indicators in the numerator and denominator have different units of measurement, then the result should be named, for example, speed - km / h.
Relative indicators, depending on their characteristics, can slightly modify the formula, but its general principle is preserved.
Absolute and relative indicators can be considered for various values. Analysis of the interaction highlights the factors:
- speakers;
- structure;
- a plan;
- implementation of tasks;
- coordination;
- intensity
- comparisons.
Relative performance indicators
Dynamic relative values are a comparison of the same factor or event in the current period to the past.
If the obtained indicator is expressed in multiple form, it is called the growth rate. In the case when the result has the form of percent, it is called the growth rate.
When relative financial indicators are presented for several periods, they are compared either in a chain or with a base value.
The product of all the chain indicators of a dynamic study gives a baseline value for the analyzed period.
Dynamic indicators allow you to understand the development (or decrease) of activity. With their help, growth rates are monitored in the analyzed interval.
Structure indicators
The indicators of the structure compare the absolute indicator, which is part of the whole with its general value.
The presented methodology is used for such calculations as relative indicators of financial stability. For example, to determine part of equity in the balance sheet structure.In this case, own sources of financing, which the company sent into circulation, are compared with current assets.
For financial stability analysis other relative indicators of the structure apply.
Also, to determine the correct structure of the analysis factors, the considered methodology is carried out. For example, relative financial stability indicators help improve the company's capital structure. On the one hand, own funds ensure the stability of the enterprise. And expanding your production capabilities is permissible with borrowed capital. These are the indicators of the structure that will help assess the compliance of each of these values with the norm.
Coordination indicators
Relative coordination indicators are similar to the previous variety, but they allow not only to assess the degree of influence of one absolute indicator on the total value, but also to determine the number of all factors.
Here, the analyst will consider not only the degree of influence of one part, but all the components. This approach allows us to evaluate the comprehensively examined whole object of study.
In other words, you can determine how many units of each factor are included in the structure of the overall indicator. This will reveal the harmonious distribution of each part in the basic concept. For example, the current liquidity indicator shows that the company is solvent and can cover its obligations to investors. However, the analysis of absolute liquidity does not comply with the standard and indicates the insufficient ability of the company to pay off its debts quickly. This means that the structure of working capital is incorrect. Calculation of the relative indicators of each component of the second section of the balance sheet will help to quickly determine this.
Intensity indicators
Intensity indicators make it possible to evaluate two qualitatively different, but related characteristics in a statistical set.
This approach allows us to determine the degree of distribution of factors in the medium under study.
For example, in the conditions of production, the presented methodology may include the profitability of labor in the context of production sites. To do this, compare the number of employees with the net income of each workshop or department. This will make it possible to assess the degree of labor return of each employee in obtaining the total profit of his site. This will determine where net income was most secured. labor intensity workers.
Relative intensity indicators will help highlight the degree of spread of the factor in the structure.
Comparison indicators
The presented approach makes it possible to determine how much the absolute indicator under study is larger than the base. This will reveal which factor and how much more (less) the factor of the same name taken as the basis.
Since the calculation takes into account indicators that are identical in name, the result will be in percent or coefficients.
For example, the net profit of the enterprise last year was in the amount of x. In the current year, the company made a profit after deducting all taxes and deductions in the amount of y.
The considered types of relative indicators allow a comparison of these two indicators: K = x / y, which will determine how much more (less) net profit in the current period, compared with the base.
Using this analysis, they compare fixed assets, working capital, labor, production costs, income and profits, etc.
Plan performance indicators
In the process of planning its activities, the enterprise establishes estimated indicators of costs, profits, etc. Planned relative indicators characterize the correspondence of real indicators to expected values.
Typically, the degree of completion of an order is presented as a factor. This helps to evaluate the degree of its implementation.
In this case, the base value will be the planned value of the indicator, and the actual figure will be compared.
The calculation of such varieties of key indicators plays a very important role in the manufacturing sector. They help to assess the quality of work of workers, as well as equipment, materials and other elements involved in the process of production of finished products and their implementation.
The presented analysis will allow to determine the degree of compliance of the fact with the plan. After this, it is necessary to conduct research on the factors that influenced the deviations, both to a lesser extent and to a greater extent.
Economic Development Indicators
These indicators compare opposite absolute values, which are mutually related. In the denominator is usually the factor value of the attribute. The numerator is the effective number.
Such an analysis is used to determine the production or economic potential, as well as the performance of the enterprise.
They are used to calculate, for example, the unit cost of production, labor productivity. Such values make it possible to determine the influence of a specific factor on the outcome of the work.
In carrying out this analysis, it is recommended that a number of other indicators be used to conduct a comprehensive study.
Having become acquainted with such a concept as relative indicators of economic and financial analysis, it is possible to conduct comprehensive studies of the processes of the object in question. Properly applying this or that type of calculation, based on various attributes and data, it will become possible to identify the causes of growth or decrease in performance. Based on the analysis, all factors affecting growth and development in the planning period are adjusted.
