The role of accounting ratio analysis in measuring financial performance of a firm a case of Mukwano Group of Companies
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Date
2019-02
Authors
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Journal ISSN
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Publisher
Kampala International University, College of Economics and Managment
Abstract
The purpose of this study was to investigate the role of Accounting Ratio analysis in
measuring financial performance of Mukwano Group of Companies. The study was guided
by three research objectives specifically to identify the different forms of ratio used by
Mukwano group of companies, determine the role of accounting ratio analysis in measuring
financial performance and identi1~’ the limitations of ratio analysis in measuring performance.
The study was covered using a cross sectional and a case study research designs which
seemed applicable for the research based on Accounting Ratio Analysis. The study was based
on a Self-Administered Questionnaire (SAQs) which were used because they are the most
suitable in a survey that involves a large number of respondents. A total of 108 employees
were randomly selected, although at last only 74 were retrieved. Data was analyzed using
frequency tables and percentages and the study concluded that despite the achievements, gaps
between this accounting ratio and performance still exist for example false accounting,
comparison is not possible if different firms adopt different accounting policies, Ratio
analysis becomes less effective due to price level changes and Lack of proper standards
affects the appropriateness of ratio analysis. The study recommends the organization to
provide a good proper working condition for accomplishment of the assigned tasks which
should be backed by enhancement of employee involvement programs and provision of
employee training and refresher programs.
Description
A dissertation submitted to the college of economics and management in partial fulfillment of the requirement for the award of a bachelor’s degree of business administration of Kampala International University
Keywords
Accounting ratio analysis, Financial performance, Firm, Mukwano Group of Companies