Profitability Measurement and Analysis in Estonian Business Practice

DOI

10.2991/icaat-16.2016.2How to use a DOI?

Keywords

Estonia, income statement, profitability analysis, profitability measures

Abstract

The paper considers whether and how Estonian companies use and analyze the profitability measures. On the one hand, profitability measures should be a central component of the management control systems, but on the other hand, they should be linked to the wealth measurement objective. In this context, the importance of a quality analysis in companies cannot be overestimated. The activities of Estonian companies and their attitudes to profitability analysis have been considered by using the results of a survey carried out in companies. The survey aims to draw attention to areas which need improvement. It has been shown how the companies make use of the traditional income statement in the analysis process and whether any adjustment is needed; whether profits as a manifestation of the value of a company merit attention; whether attention is accorded to the capital maintenance problem and the price of capital - hence the real growth of the wealth; whether the cash-based profit or contribution margin, for example, are analyzed. An accountant's role in the analysis process is also under consideration.

Copyright

© 2016, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Maret Branten
AU  - Jaan Alver
PY  - 2016/12
DA  - 2016/12
TI  - Profitability Measurement and Analysis in Estonian Business Practice
BT  - Proceedings of the 5th International Conference on Accounting, Auditing, and Taxation (ICAAT 2016)
PB  - Atlantis Press
SP  - 8
EP  - 22
SN  - 2352-5428
UR  - https://doi.org/10.2991/icaat-16.2016.2
DO  - 10.2991/icaat-16.2016.2
ID  - Branten2016/12
ER  -