Financial Analysis for Managers - Article Example

Financial Analysis for Managers Mahatma Gandhi once said- 'The ends should justify the means'. This ment simply implies that a person should not pursue an entirely result-oriented path which disregards the methods used to achieve the goals. The goals must be achieved through means which meet certain ethical standards. However, the highly competitive nature of today's corporate world has given rise to an essence of unethical behaviour which underlies a majority of business operations; in order to ensure their success.

Many a times, unethical behaviour in the workplace has an immense negative impact on the organization and its employees. These effects can be psychological, financial, social, or even bureaucratic in nature. Financially speaking, if a company adheres to unethical means, then it endangers its image in the eyes of the public, and less people would be interested in dealing with the firm. These may include suppliers, financial institutions, customers and distributors. Such a trade-less condition obviously is a set-back to the revenue, and thus the profit of the company.

Moreover, from an intra-firm point of view, employees would have lesser faith in a company which does not deal ethically with the public, as there emerges a possibility of the firm using corrupt means against employees; if need be someday. Not only does this encourage the existing workforce to leave the firm, it also keeps potential employees to join the firm. This proves to be disastrous for the company's overall growth and progress. Socially speaking, if the unscrupulousness of a company's managers is exposed to the general public, then their goodwill shall demolish and no one would be willing to further interact with the company.

A fall in the reputation of big companies can prove to be a major barrier to entry when it comes to penetrating new markets. Moreover, dishonourable behaviour of high-posted officials sets a bad example for customers, employees and other dealers, and this may lead to more cases of corrupt behaviour. There have been numerous cases of immoral behaviour by managers in the past. An example would be creating a web presence, like a blog or a web-page, by a fictitious consumer promoting the products of the company, or rather supporting a letter of commendation with a name other than your actual name.

More serious instances could be those which involve sharing of vital information of a former company's development plan. Apart from these, cases of unethical managerial behaviour includes sexual harassment, bribery, benefitting from another's ideas, disrespecting employee's privacy, etc. Though a lot of unethical methods have been made illegal by the authorities, there still remains scope for those which are not covered by laws and rules. For such cases, a person is expected to depend on his conscience in order to choose the option which meets ethical standards of others.

A balance sheet is a financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time. It is a snapshot of what a company owns and owes at that point in time. It is divided into three main parts- Assets, Liabilities, and Shareholders' Equity. Accounts such as cash, inventory, property and goodwill are on the asset side of the balance sheet, while on the liability side, there are accounts such as accounts payable, long-term debt, minority interest or deferred payments.

The shareholders' equity includes labels like common stock, retained earnings, capital surplus, stock option warrants, etc. ReferencesRP News Wires. 'Survey: Ethics impact employment and productivity'. Retrieved October 30, 2007, from http://www.reliableplant.com/article.asparticleid=2236Investopedia. 'Balance Sheet'. Retrieved October 30, 2007, from http://www.investopedia.com/terms/b/balancesheet.aspAnonymous Employee. 'Unethical Behaviour - It's Impact on Today's Workplace'. Retrieved October 31, 2007, from http://www.

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