An understanding of the purpose is particularly important in financial statement analysis because of the numerous available techniques and the substantial amount of data
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4.1. Articulate the Purpose and Context of Analysis
Prior to undertaking any analysis, it is essential to understand the purpose of the analysis. An understanding of the purpose is particularly important in financial statement analysis because of the numerous available techniques and the substantial amount of data.
Some analytical tasks are well defined, in which case articulating the purpose of the analysis requires little decision making by the analyst. For example, a periodic cred
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