Financial statement analysis and decision making process :

Abstract

The study analyzed the effect of financial statement analysis on decision making process a case study of centenary rural development bank Kampala town Uganda. The specific objectives of the study were, to determine whether management make use of financial statement in decision making, to fmd out and identify the role of financial statement in proper decision making, to identify the limitation pertaining to the use of financial statement in decision making. The study used qualitative and quantitative data sources to analyze data collected. This was done with the aid of computer packages Ms word and Ms excel whereby charts and graphs were presented. The study found out that to a small extent (13%) financial statements are based on by the management to make good economic decisions. However, majority of the respondents agreed that the management make good economic decisions without basing on financial statements. To the limitations of financial statement in decision making, loss of data is one of the biggest challenge limiting financial statement in decision making a 37.5% The financial statement analysis should provide working experience through combining theoretical skills band practical skills, it should provide useful recommendations and suggestions to the organization on improving the financial reporting.