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Empire Company Financial Analysis

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A public traded company is defined as a company that has permission to sell stock in its own company to the public. The rational of a company going public is to increase the growth of the company. Before a company decides to go public, considerations of size and the industry it serves must be considers. Although, deciding to go public can be a great move the company much thought must go into the decision. When you have medium-sized company working capital is essential. When the company’s funds operate on a fixed interest basis the company is vulnerable to failure, so the only solution may be taking the company public (Chandra, 2011). Other, benefits of a company going public is the increase of capital for the sale of …show more content…

Empire Company Ltd have four main type of ratios that will show the financial health status of an organization are: Financial Leverage (Debt), Liquidity, Asset and Profitability efficiency. The ratio of financial leverage measures the extent to which an organization relies on the debt financing in its capital structure. Financial leverage ratio also focuses on the long-term obligations and the organization ability to repay debt. The Financial Leverage ratio equation is as follows: Total Liabilities / Total Assets = Debt Ratio $20,000 / $40,000 = 0.5 The ratio of Liquidity will show whether an organization has enough cash on hand to pay any short-term liabilities or debt that may arise. The liquidity of an organization is defined by the current assets and liability of the organization’s balance sheet. The Asset efficiency ratio shows how a company can effectively use various assets to generate more revenue. However, there are two Liquidity ratios. The equations for Current and Quick ratios are as follows: (1) Current Assets / Current Liabilities = Current …show more content…

Few are willing to report such fraud but, many of these employees are not willing to forward to speak of known fraud because they are frightened of losing the jobs or how they will be reprimanded. There are many sections within the Sarbanes-Oxley Act 2002 that address how to provide a safe environment for whistleblowers. In Section 806 there are actions to be taken if civil damages for the whistleblower in a public company. For the whistleblower, that may suffer any retaliation from the organization in providing information in an investigation or is participating as a witness in any federal securities law violation (Prentice & Bredeson,

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