Horizontal Analysis vs. Vertical Analysis

Horizontal Analysis vs. Vertical Analysis Explained.

Horizontal analysis is the review of a company’s financial statements (performed horizontally ) over multiple periods. Also known as static analysis, Vertical Analysis is the study of relationship between various items of Balance Sheet or statement of Profit & Loss of a single year or period. Vertical analysis is performed vertically inside of a column. It represents amounts as percentages of a base figure.

Academic Question

Economic and Financial Management of the Strategic Decisions of International Marketing.

The work will consist of making an economic-financial analysis from the annual accounts of a real company, applying the content of the subject seen in the class (Descriptive analysis of the business; Horizontal and Vertical Analysis; Ratio analysis).

The scheme of work could be:

• Business presentation;
• Study of the Balance Sheet and Income Statement (Horizontal and Vertical Analysis of the most important components);
• Working Capital calculation;
• Ratios calculation (Liquidity; Solvency; Profitability; Activity);
• Analysis and Valuation of the business
• Final conclusions and Implications

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