Financial analyst
A financial analyst, securities analyst, research analyst, equity analyst, or investment analyst is a person who performs financial analysis for external or internal clients as a core part of the job.
1. Introduction
The aim of this tutorial is to answer these questions by providing a succinct yet advanced overview of financial statements analysis. If you already have a grasp of the definition of the balance sheet and the structure of an income statement, this tutorial will give you a deeper understanding of how to analyze these reports and how to identify the "red flags" and "gold nuggets" of a company. In other words, it will teach you the important factors that make or break an investment decision.
Whether you watch analysts on CNBC or read articles in The Wall Street Journal, you'll hear experts insisting on the importance of "doing your homework" before investing in a company. In other words, investors should dig deep into the company's financial statements and analyze everything from the auditor's report to the footnotes. But what does this advice really mean, and how does an investor follow it?
The aim of this tutorial is to answer these questions by providing a succinct yet advanced overview of financial statements analysis. If you already have a grasp of the definition of the balance sheet and the structure of an income statement, this tutorial will give you a deeper understanding of how to analyze these reports and how to identify the "red flags" and "gold nuggets" of a company. In other words, it will teach you the important factors that make or break an investment decision.
Fundamental analysis is the cornerstone of investing. In fact, some would say that you aren't really investing if you aren't performing fundamental analysis. Because the subject is so broad, however, it's tough to know where to start. There are an endless number of investment strategies that are very different from each other, yet almost all use the fundamentals.
1.1. Purpose of study
Ø The purpose of my study is to find out that the Financial analysts are better for the banking sector or not.
Ø The second purpose of my study is that Financial analyst can effect the decision of banking authorities or not.
Ø The reason of my study is to elaborate the role of financial analyst in banking sector.
1.2 Context of study
Financial Analysis History
Thanks to the decades of change, opportunity and disasters, financial data in most forms is relevant, reliable and regulated. Today, we are inundated with data from around the world. But markets and institutions today and the set of regulations on the books is based on a long history of factors. And this process is dynamic. To understand where the institutional markets are today and when and why they might change requires a reasonable understanding of history. The Federal Reserve was established only in 1914 as a central bank, well over a century after the first central bank was established. Why? The SEC and vast regulations of financial markets and accounting happened in the 1930s, a big switch from the free markets of earlier American history. Why? The internet is essentially unregulated. What does this mean? What are the implications for the future? To understand the present and plan for the future requires an understanding of the past.
Graham & Dodd
The landmark study of financial analysis is Security Analysis by Benjamin Graham (an investment manager) and David Dodd (professor of finance at Columbia). The first edition was 1934, about the worst period in the financial history of America. Despite being in the middle of the Great Depression, their analysis and recommendations were professional and hard boiled. They distinguished investment from speculation, but considered most investments in common stock as speculative. The focus of financial analysis has changed substantially since then, but a historical foundation in financial analysis requires quite a bit of time with Graham and Dodd.
1.2.1 Reasons of financial analysis
Financial analysis is done for checking business position and the reason is that
When the business need capital the creditor and bank check the position of business for this purpose financial statement and financial analysis is required.
When investor wants to invest in a certain company he will surly check the position of that company for this purpose he will need financial analysis
To check the worth of business
1.3 Significance of study
The CFA designation
The CFA is a qualification for finance and investment professionals, particularly in the fields of investment management and financial analysis of stocks, bonds and their derivative assets. The program focuses on portfolio management and financial analysis, and provides generalist knowledge of finance. The CFA designation was first awarded in 1963 As of August 2010; CFA Institute has more than 101,000 members around the world, including more than 89,000 CFA charter holders.
History
The predecessor of CFA Institute, the Financial Analysts Federation (FAF), was originally established in 1947 as a service organization for investment professionals in its societies and countries. In 1990, in hopes of boosting the credential's public profile, CFA Institute (formerly the Association for Investment Management and Research or AIMR) was created from the merger of the Financial Analysts Federation and the Institute of Chartered Financial Analysts (ICFA). Many Financial Analysts (FA credential) were "grandfathered" into CFA charter holders without taking any of current levels as a result of the 1990 merger between the ICFA and FAF.
The CFA program began in the United States but has become increasingly international with many people becoming charter holders across Europe, Asia and Australia. By 2003 fewer than half the candidates in the CFA program were based in the US and Canada, with most of the other candidates based in Asia or Europe. India and China have shown some of the highest growth from 2005-2006 with increases of 25% and 53% respectively in the total number of charter holders.
The importance or the role of financial statement analysis in decision making
Financial ratios are the primary method used to analyze a company's financial statements. Most financial analysts focus on determining a company's financial strength, sales and profitability growth rates in order to ascertain its value or creditworthiness. Growth rates usually are a function of industry growth rates, competitive advantages and corporate strategy. A meaningful financial statement analysis must be based on more than just financial ratios.
The analyst must understand industry practices in order to properly evaluate a company's financial performance. What might be unacceptable financial relationships or results in one industry may be perfectly normal in another. An analyst also must understand the company's business, its objectives, the products or services it provides the market and customers it serves. Reading the annual report is an excellent start to understanding a public company's objective and its management direction, beginning with the CEO's or chairperson's letter to the stockholders.
Next, the analyst should review the pages that discuss the different operations and business environment, in particular, management's discussion and analysis of operations and financial condition. That should be followed with a review of the financial statement footnotes to understand what accounting practices were used to report the financial data. The analyst should then examine the financial summary information to get an overview, and then delve deeply into the financial statements, using financial ratios to evaluate the company's financial strength and performance. While performing the analysis, the analyst should consider whether what the CEO has reported about the company's performance and objectives matches the financial statements. The financial statements are ultimately the "scorecard" for the company's performance.
1.4 Problem and definition
Problem
Role of financial analyst in banking sector
Who is a Financial Analyst?
After the accountant completes his role of preparing the balance sheets, then the "financial analyst" zooms into action. The scope of work for a "Financial Analyst" is spread over a broad spectrum. He has a vision to foresee the future of the company and helps the company officials to understand the company's stand, advising them of the possible profit and losses. Finance is more of a risk management area. Students opting to take up finance as their career need to understand that finance is a much generalized area wherein banking, real estate, corporate control, insurance organizations etc. come under one umbrella.
1.4.1 Sub problems
Ø There is non availability of job in Pakistan.
Ø There is no formal qualification criteria, analysts usually have graduate level training in finance such as MSF or MBA degrees, or are qualified accountants (i.e. CMA, CCA, ACCA, CGA or CA designation).
Ø The research department sometimes doesn't have the ability to bring in enough money to be a self-sustaining research company.
Ø There is lack of qualified persons.
2.1 Literature Review
2.1.1 Analyst Recommendations: Do Sell Ratings Exist?
If you've ever tried to decipher an equity research reports, you are likely familiar with the ratings used by analysts (such as buy, hold, accumulate, outperform/underperform, accumulate, neutral, overweight etc...) to sum up their opinion of a stock. But what do these terms actually mean to you? Most investors just want to know whether a stock is "good" or not, but how can an investment decision be reached when you practically need a dictionary to sort through the jargon?
In this article, we'll look at how to decipher the analyst rating system and discuss how useful analyst ratings are for the average investor.
The Background on Analyst Reports
A research analyst is a financial professional who researches investments and makes recommendations. Most people think of analysts as equity analysts who, as the name implies, research stocks (equities). In fact, analysts analyze everything from bonds to derivatives. In this article we'll be talking about equity analysts.
Analysts release their findings in research reports, which can be anything from one- or two-page summaries to detailed documents that are dozens of pages long.
An analyst report will generally contain the following items:
An analyst report will generally contain the following items:
2. An opinionated thesis explaining why the analyst believes the company will succeed or fail.
3. A target price for the stock over the next year (or two).
4. A recommendation or rating.
Most analysts put plenty of work into these reports, often traveling to the company's headquarters and getting a first-hand tour of operations.
Not All Ratings are Created Equal
The bulk of an analyst's work is contained in the body of the research report. Despite this, the rating gets the lion's share of attention. It's easy to understand why: ratings are the sexy sound bites that can be easily repeated in the financial media. Plus, most investors don't have the time to sit down and read through a 20-page report.
The problem is that ratings scales are not uniform across Wall Street. At one brokerage, "buy" may be the strongest recommendation, while at another, "buy" could be second to a "strong buy" rating. The second-highest ratings also have a number of different other names: "accumulate," "outperform," "moderate buy" or "overweight." A similar mix of terms appears
further down the scale, as the ratings become more negative. Finally, some brokerages use a number system to indicate their rating on a stock.
The chart below shows an approximation of where ratings fit in relation to each other:
Buy, Buy, Buy
Even greater cause for concern than the complicated system of terms is the tendency of ratings to be buys (or at least positive). The reasons for this are ingrained in how the financial industry works.
The causes for the popularity of buy ratings are found in the relationships that result when brokerages provide investment banking services to large corporations. The bad news for retail investors is that the investment banking side of the business is very lucrative for brokerages. Their desire to please their investment banking clients creates a huge conflict of interest. Issuing negative research on the stocks of their own corporate clients may cost brokerages profitable business. In other words, a brokerage firm would rather be wrong on any buy/sell recommendation than be right and lose a corporate client
The stake in issuing buy ratings is especially high when a brokerage firm is underwriting a company's offering of securities. Think of it this way: If a large brokerage just finished underwriting a technology company's IPO, would it seem logical for the brokerage's analyst to put a poor rating (such as a sell or market-underperform) on the stock? Of course not -a sell rating might even cost the analyst his or her job.
Other key sources of revenue in the financial industry are the fees and commissions brokerages charge to execute customer orders. Research reports touting the fabulous things to come for stocks can indirectly increase sales for a brokerage as clients buy more stock.
Also, remember that analysts are human, too. Conflicts can form when an analyst covers a company in which he or she (or friends and family) owns stock. An analyst's disincentive to put his or her own portfolio at risk could affect a decision about whether to release negative news.
We should mention that, on May 10, 2002, the Securities and Exchange Commission (SEC) made changes to the rules that govern some of the conflicts of interest we've mentioned here. Changes were meant to protect individual investors in the wake of some of the analyst scandals
Following the dotcom meltdown. Some say the changes have resolved much of the problems; others say you can never completely free research from conflicts of interest.
What Good are Analyst Reports?
We've discussed the numerous terms analysts use to rate stocks, and why they so often reflect positively on companies. When you add all this up, does a buy rating mean you should purchase the stock? Probably not.
Realize that research reports and ratings are not meant to advise you personally. You'd think that the meanings of terms such as "buy" or "sell" are straightforward. Actually, firms emphasize that ratings are not advice and that investment decisions should not be made solely on an analyst rating. (Perhaps this helps explain part of the confusion in the differing rating scales.)
This disclaimer isn't a complete cop-out from the brokerage industry. Any decision to invest in a company is based not just on analysis of the stock but also on the investor's personal situation and strategy. A strong-buy rating for one investor might be a sell for another. A young executive might be totally comfortable with a risky high-tech stock that would be a terrible investment for a 90-year-old widower. Generally, you'd sit down with a financial planner to determine your risk tolerance, time horizon, asset allocation and so forth. The analyst doesn't know any of this information and thus can't make recommendations directly to you.Summary
Although the analyst's rating is probably the most quoted part of a report, it may be the least useful. As a general rule, don't invest your money based solely on these recommendations. This doesn't mean that analyst reports are useless. Research reports can contain some great information, but use them only as a source of data that complements your research, rather than completes it.
2.1.2 Restoring Financial Stability
There are many cracks in the financial system, some of which we now know, others no doubt we will discover down the road. The eighteen white papers and executive summaries of each chapter of New York University Stern School of Business book, “Restoring Financial Stability: How to Repair a Failed System”, forthcoming this March by John Wiley & Sons, and contributed to by 33 of our faculty members, describe a relevant issue at hand and corresponding regulatory proposals. A common theme of our proposals notes that fixing all the cracks will shore up the financial house but at great cost. Instead, by fixing a few major ones, the foundation can be stabilized, the financial structure rebuilt, and innovation and markets can once again flourish.
This short note is meant to encapsulate the key themes from the book, focused on the causes of the financial crisis of 2007-2009 and regulatory principles that we recommend drive the longer-term reforms.
Causes
Yes, there was a housing bubble and a crash…
Yes, there was a housing bubble and a crash…
There is almost universal agreement that the fundamental cause of the crisis was the combination of a credit boom and a housing bubble. There are many statistics to back this up. For example, in the five year period from 2002-2007, the ratio of debt to national income went up 100% from 3.75 to 4.75 to one. It had taken the prior full decade to accomplish this feat, and fifteen years prior to that. During this same period, house prices grew at an unprecedented rate of 11% per year.
When the “bubble” burst, it necessitated a severe economic crisis to come. The median family, whose house represented 35% of all their wealth and who was highly levered, would not be able to continue as is. The economy was going to feel the brunt of it.
It is much less clear, however, why this combination of events led to such a severe financial crisis, that is, why we had widespread failures of financial institutions and the freezing up of capital markets. The systemic crisis that ensued reduced the supply of capital to creditworthy institutions and individuals, amplifying the effects to the real economy.
There is no shortage of proximate causes. Mortgages granted to people with little ability to pay them back and designed to systemically default or refinance in just a few years, depending on the path of house prices. The securitization process that allowed credit markets to grow so rapidly but at the cost of lenders having little “skin-in-the” game. Opaque structured products that were rubber stamped AAA by the rating agencies more interested in fees than risk assessment.
But wasn’t the risk transferred through credit derivatives?
Somewhat surprisingly, this is not the ultimate reason the financial system collapsed. If this were it, then capital markets would have absorbed the losses, and the financial system would have moved forward. Instead, blame needs to be squarely placed at the large, complex financial institutions (LCFIs) -- the universal banks, investment banks, insurance companies, and (in rare cases) even hedge funds -- that dominate the financial industry.
The biggest fault lies in the fact that the LCFIs ignored their own business model of securitization and chose not to transfer the credit risk to other investors.
The whole purpose of securitization is to lay risks off the economic balance-sheet of financial institutions. But the way securitization was achieved, especially during 2003-2Q 2007, was more for arbitraging regulation than for sharing risks with markets. The reason why banks face capital requirements is that they have incentives to take on excessive risks given their high leverage. Capital requirement ensures that first, banks find it costly to take on risks, and second, when they get hit by a shock, there is enough of a buffer zone to protect them.
But that's not what happened. Banks set up a shadow banking sector of SIV’s and conduits funded by asset-backed commercial paper that was guaranteed – often fully – by banks through liquidity and credit enhancements. Designing things this way allowed banks to transform on-balance sheet loans and assets into off-balance sheet contingent liabilities, and thereby exploit loopholes in regulators "Basel" capital requirements. Measures of risk barely moved even as their balance sheets exploded with liquidity “puts” (sold to the shadow banking sector) and AAA-asset backed tranches. These risky assets were systemic in nature as they were in effect equivalent to writing out-of-the-money put options on aggregate crises.
This lack of risk transfer – the leverage “game” that banks played – is the ultimate reason for collapse of the financial system, in our opinion.
Bankers and regulators are both to blame…
It is important to acknowledge that in the period leading up to the crisis, bankers and insurers increasingly paid themselves through short-term cash bonuses based on volume and marked-to-market profits, rather than on long-term profitability of positions created. There was neither any discounting for liquidity risk of asset-backed securities, nor any proper assessment of true skills of large “profit”-centers. All this just served to make regulatory arbitrage the primary business of the financial sector.
Thus, the current regulatory architecture cannot escape blame either. In fact, its cracks made the system vulnerable to bankers’ errors and short-term incentives in the first place. In a world without regulation, creditors of financial institutions (depositors, uninsured bondholders, etc.) would put a stop to excesses of risk and leverage by charging higher costs of funding, but lack of proper pricing of deposit insurance and too-big-to-fail guarantees has distorted incentives in the financial system. And, for years, regulation – capital requirement in particular – has targeted individual bank risk, when the justification for its existence resides primarily in managing systemic risk. It is to be expected that financial institutions would maximize returns from the explicit and implicit guarantees by taking excessive aggregate risks, unless these are priced properly by regulators.
Regulatory principles
Where should the regulators start to fix the system? The integration of global financial markets has certainly delivered large welfare gains through improvements in static and dynamic efficiency - the allocation of real resources and the rate of economic growth. These achievements have however come at the cost of increased systemic fragility, evidenced by the ongoing crisis. The challenge of redesigning the regulatory overlay to make the global financial system more robust must be met without crippling its ability to innovate and spur economic growth.
Four changes seem paramount, each addressing either regulatory arbitrage or the externality imposed by actions of individual institutions on systemic stability. We argue in the book that future regulation should:
Ø Prevent obvious regulatory arbitrage (privatizing, for example, the financial investments of government-sponsored enterprises) and charge for guarantees – deposit insurance, too big to fail, loan guarantees and the bailout – using marking-to-market that reflects leverage and risk in a continual manner. It will be good to know whether the financial system can even pay for the subsidies it receives.
Ø Recognize the negative externality of LCFIs. Then quantify the systemic risk of LCFIs and “tax” (through capital requirements or deposit insurance fees) their contributions to systemic risk rather than individual risk. This is hard to do, but present regulations do not even claim to address the problem. The need for such systemic risk regulation, possibly by augmenting Central Bank agendas, is only underscored by the growing size of the few remaining players in the financial arena.
Ø Enforce greater transparency of over-the-counter derivatives positions and off-balance-sheet transactions, employing centralized clearing for standardized products and, at a minimum, centralized registries for customized ones so that counterparty risk can be assessed.Summary
Some say that these changes inhibit financial innovation. We think this gets the issue wrong. The goal is not to have the most advanced financial system, but a financial system that is reasonably advanced but robust. That's no different from what we seek in other areas of human activity. We don't use the most advanced aircraft to move millions of people around the world. We use reasonably advanced aircrafts whose designs have proved to be reliable. The same is the case with ethical drugs. Although we are now in a golden age of biomedical research, our goal is to sell only products that have been tested extensively.
2.2 Object of study
Study is done for highlighting the problems and of financial analysts and there role to improve the financial analysis system
By financial analyst services we can increase the worth of our business or organization customer will relay on us.
Its cost may be too much which will increase the prices of our product.
2.3 SWOT analysis
2.3.1 Strength
Ø They give better analysis to banks
Ø They are professionals
Ø They are highly qualified
Ø They are experienced
Ø Their way of auditing is better than externals
Ø Their internal efficiencies are better than externals
Ø Their decisions can be more beneficial than any other person of the organization
Ø Their personal skills can be more effective in decision making
Ø Their honesty with their organization and work
Ø Their working authorities
2.3.2 Weakness
Ø Lack of government facilities
Ø Our ways of education
Ø Lack of salary
Ø Lack of job
Ø Lack of experience
Ø Due their high salaries some organization can not afford them
Ø Poor perception about company's financial position
2.3.3 Opportunities
Ø High salary packages
Ø More facilities provided by the Government
Ø More job vacancies
Ø Attractive salary packages provided by other competitor companies
2.3.4 Threats
Ø Their high responsibility for work
Ø Negligence in duty
Ø Strike policies of the organizations which can not be followed by the analyst
2.4 Hypothesis Development
2.4.1 Alternative hypothesis
H1: Financial analyst can affect the banking sector
2.4.2 Null hypothesis
H0: Financial analyst can not affect the banking sector
3 Questionnaire
3.1 Data analysis
Question 01:
Are you Banker?
Valid
|
Frequency
|
Percentage
|
Yes
|
6
|
20
|
No
|
24
|
80
|
Total
|
30
|
100
|
Explanation:
According to the statement twenty percent members are banker and eighty percent member are not bankers
Question 02:
Do you think financial analyst is important for bank?
Valid
|
Frequency
|
Percentage
|
Yes
|
30
|
100
|
No
|
0
|
0
|
Total
|
30
|
100
|
100%members think that financial analyst is important for bank and no one thinks that financial analyst are not important for banks.
Question 03:
Do you think financial analyst can improve banking industry?
Valid
|
Frequency
|
Percentage
|
Yes
|
29
|
96.66667
|
No
|
1
|
3.333333
|
Total
|
30
|
100
|
96.33% members think that financial analyst can improve banking industry.
And 3.33% members says that financial analyst can not improve banking industry
Question 04:
Now a days Pakistan faces financial crises can financial analysts help to reduce these crises?
Valid
|
Frequency
|
Percentage
|
Yes
|
28
|
93.33333
|
No
|
2
|
6.666667
|
Total
|
30
|
100
|
93.33% members agree with the statement.
And 6.66% member disagree with the statement
Question 05:
Can financial report provided by analyst can be effective for short term financing?
Valid
|
Frequency
|
Percentage
|
Yes
|
25
|
83.33333
|
No
|
5
|
16.66667
|
Total
|
30
|
100
|
83.3% members say that financial report which is provided by analyst can be effective for short term financing.
And 16.6% member says that financial report can not affect short term financing
Question 06:
Can financial report provided by analyst can be effective for long term financing?
Valid
|
Frequency
|
Percentage
|
Yes
|
27
|
90
|
No
|
3
|
10
|
Total
|
30
|
100
|
90% members say that financial report provided by analyst can be effective for long term financing
And 10% say that financial report provided by analyst can not be effective for long term financing
Can financial report provided by the financial analyst increase Good will of banking sector?
Valid
|
Frequency
|
Percentage
|
Yes
|
25
|
83.33333
|
No
|
5
|
16.66667
|
Total
|
30
|
100
|
83.3% members say that financial report provided by the financial analyst can increase Good will of banking sector.
And 16.6% members say that financial report provided by the financial analyst can not increase Good will of banking sector.
Do you think non availability of job is also reason of shortage of financial analysts?
Valid
|
Frequency
|
Percentage
|
Yes
|
21
|
70
|
No
|
9
|
30
|
Total
|
30
|
100
|
Explanation:
70% members think that non availability of job is also reason of shortage of financial analysts.
But 30% members think that non availability of job is not reason of shortage of financial analysts.
Question 09:
Do you think financial analysts can reduce farads and corruption in banking industry of any country?
Valid
|
Frequency
|
Percentage
|
Yes
|
25
|
83.33333
|
No
|
5
|
16.66667
|
Total
|
30
|
100
|
83.3% members think that financial analysts can reduce farads and corruption in banking industry of any country
And 16.6% members think that financial analysts can not reduce farads and corruption in banking industry of any country.
Question 10:
Does financial report which is provided by analysts’ increases the confidence of customer to invest?
Valid
|
Frequency
|
Percentage
| |
Yes
|
28
|
| |
No
|
2
|
| |
Total
|
30
|
100
|
93.3% members say that financial report which is provided by analysts can increases the confidence of customer to invest.
6.6% member’s say that financial report which is provided by analysts can not increases the confidence of customer to invest.
Question 11:
Do you think we can do our SWOT analysis through financial report provided by financial analysts?
Valid
|
Frequency
|
Percentage
| |
Yes
|
28
|
| |
No
|
2
|
| |
Total
|
30
|
100
|
93.3% members think that we can do our SWOT analysis through financial report provided by financial analysts
6.6% members think that we can not do our SWOT analysis through financial report provided by financial analysts
Question 12:
Does financial analyst know our strong and weak points?
Valid
|
Frequency
|
Percentage
|
Yes
|
26
|
86.66667
|
No
|
4
|
13.33333
|
Total
|
30
|
100
|
86.6% members say that financial analyst can know our strong and weak points.
13.3% members say that financial analyst can not know our strong and weak points.
Do financial analysts help us to create batter financial planning?
Valid
|
Frequency
|
Percentage
| |
Yes
|
28
|
| |
No
|
2
|
| |
Total
|
30
|
100
|
93.3% members think that financial analysts can help us to create batter financial planning
6.6% members think that financial analysts can not help us to create batter financial planning
Question 14:
Do financial analyst reduce risk rate which is faced by the industry?
Valid
|
Frequency
|
Percentage
|
Yes
|
27
|
90
|
No
|
3
|
10
|
Total
|
30
|
100
|
Explanation:
90% members say that financial analyst reduce risk rate which is faced by the industry
And 10%members say that financial analyst can not reduce risk rate which is faced by the industry
Question 15:
By financial analyst the internal obstacles the company which is faced by the company can be?
a) Increased
b) Decreased
c) You don’t know
d) Non of them
Valid
|
Frequency
|
Percentage
|
Increased
|
3
|
10
|
Decreased
|
21
|
70
|
You don’t know
|
5
|
16.66
|
Non of them
|
1
|
3.33
|
TOTAL
|
30
|
100
|
Explanation:
10%members say that by financial analyst the internal obstacles of the company which is faced by the company can be increased.
70%members say that by financial analyst the internal obstacles of the company which is faced by the company can be decreased.
16.6%members say that they do not know.
3.3%members say none of them
Question 16:
What do you think about banking industry?
a) Need financial analyst
b) You don’t know
c) Don’t need financial analyst
d) non of them
Valid
|
Frequency
|
Percentage
|
Need financial analyst
|
28
|
93.33333
|
Don’t need financial analyst
|
0
|
0
|
You don’t know
|
2
|
6.666667
|
Non of them
|
0
|
0
|
TOTAL
|
30
|
100
|
Explanation:
93.3%members think that banking industry need financial analyst.
And 6.6% member do not know
Question 17:
Is financial analyst playing role in economic development of Pakistan?
a) Positively
b) Negatively
c) Both
d) None of them
Valid
|
Frequency
|
Percentage
|
Positively
|
17
|
93.33333
|
Negatively
|
1
|
0
|
Both
|
12
|
6.666667
|
Non of them
|
0
|
0
|
TOTAL
|
30
|
100
|
Explanation:
56.6%members think that financial analyst is playing positive role in economic development of Pakistan
3.3%members think that financial analyst is playing negative role in economic development of Pakistan.
And 40%members think that financial analyst is playing negative role in economic development of Pakistan.
4 Conclusion
After analyzing the whole questionnaire I have concluded that financial analyst is important for banking sector.
According to the questionnaire analysis members say that financial report provided by analyst can be effective for short term financing as well as long term financing. It can increase the good will of banking sector. Participants also think that financial analysts can reduce farads and corruption in banking industry of any country. Financial report which is provided by analysts can also increase the confidence of customer to invest or to deposit in their banks. Financial analysts also help us to create batter financial planning and decisions in financial crises and provide ways how to survive in these crises. By financial analyst we can also decrease our internal obstacles which are faced by the banking sector.
5 Recommendations
In our country there is a lack of financial analyst due to lack of jobs and lack of education system so government should provide facilities and it also provide jobs to the financial analyst and should improve their education system. Now a day political environment and law an order conditions are not good so government should also check this problem to increase the jobs.
We should provide proper and true in formations to financial analyst for better result and analysis.
6 Bibliography
Article 1
Article 2
History
http://acct.tamu.edu/giroux/finhistory.html
www.google .com
7 Appendix
Questionnaire
Dear Participant,
I am student of MBA at Riphah International University Islamabad. I am interested in learning about the “Role of financial analysts in a Banking sector”. My objective is to help expand the body of knowledge about the important area of banking sector.
We expect your best co-ordination for retrieving the following information and assure you that information provided by you will be highly confidential and will not be used anywhere else for any other purpose.
Yours sincerely,
Naveed Shehzad
Personal Information:-
Name: -----------------------------------------------------------------
Age: -----------------------------------------------------------------
Gender: -----------------------------------------------------------------
Occupation: -----------------------------------------------------------------
Contact #: -----------------------------------------------------------------
E-mail: -----------------------------------------------------------------
Date: -----------------------------------------------------------------
1. Are you banker?
a) Yes b) No
2. Do you think financial analyst is important for bank?
a) Yes b) No
3. Do you think financial analyst can improve banking industry?
a) Yes b) No
4. Now a days Pakistan faces financial crises can financial analysts help to reduce these crises?
a) Yes b) No
5. Can financial report provided by analyst can be effective for short term financing?
a) Yes b) No
6. Can financial report provided by analyst can be effective for long term financing?
a) Yes b) No
7. Can financial report provided by the financial analyst increase Good will of banking sector?
a) Yes b) No
8. Do you think non availability of job is also reason of shortage of financial analysts?
a) Yes b) No
9. Do you think financial analysts can reduce farads and corruption in banking industry of any country?
a) Yes b) No
10. Does financial report which is provided by analysts’ increases the confidence of customer to invest?
a) Yes b) No
11. Do you think we can do our SWOT analysis through financial report provided by financial analysts?
a) Yes b) No
12. Does financial analyst know our strong and weak points?
a) Yes b) No
13. Do financial analysts help us to create batter financial planning?
a) Yes b) No
14. Do financial analyst reduce risk rate which is faced by the industry?
a) Yes b)No
15. By financial analyst the internal obstacles the company which is faced by the company can be?
e) Increased
f) Decreased
g) You don’t know
h) Non of them
16. What do you think about banking industry
e) Need financial analyst
f) You don’t know
g) Don’t need financial analyst
h) non of them
17. Is financial analyst playing role in economic development in Pakistan?
e) Positively
f) Negatively
g) Both
h) None of them
18. What is the role of financial analyst according to your point of view?
_________________________________________________________
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19. In Pakistan financial analysts are not available, so what are the main reasons according to your opinion?
_________________________________________________________
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20. According to your opinions what are the steps Govt. of Pakistan take to increase the number of financial analyst?
_________________________________________________________
_________________________________________________________
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21. According to your point of view what are the reasons of shortage of financial analysts?
_________________________________________________________
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INTERNATIONAL FINANCIAL MANAGEMENT
