Page 1 - Lesson Note

CLASS – XII

ACCOUNTANCY
TOOLS OF FINANCIAL ANALYSIS

Meaning of Comparative Statement:
 Comparative Statement: Financial Statements of two years are compared
and changes in absolute terms and in percentage terms are calculated. It is
a form of Horizontal Analysis.
 Comparative Statements

 It is a statement that shows changes in each item of the financial
statement in absolute amount and in percentage, taking the amounts of
the preceding as counting period as the base.

 Types of Comparative Statements:
 1. Comparative Balance Sheet; and
2. Comparative Statement of Profit and Loss.

 Comparative Balance Sheet: It shows the increases and decreases in
various items of assets, equity and liabilities in absolute term and in
percentage term by taking the corresponding figures in the previous year’s

balance sheet as a base.
 Format for a Comparative Statement of
Profit and Loss
Comparative Statement of Profit and

Loss
For the years ended on 31st March, 2014
and 2015

Absolute
2014 2015
Change
Percentage
Rs. Rs. Rs.(current
Particulars Change
year-
(previous (current %
previous
year) year)
year)

I. Revenue from