Essay about Assignment on Cima

Words: 3039
Pages: 13


Since time immemorial is considered as a performance measurement tool for the importance and effectiveness of the management organization to control and to ensure appropriate performance goals and organizational goals.

Various studies have been done in connection with the measurement of performance it is primarily intended to improve the effectiveness of the performance of the evolutionary process. Keep in mind, evaluation or performance measurement is a component that has been accepted as a principle to ensure that the benefits for these organizations.

In addition, the performance is a process that produces a specific period and produced something to measure the ability, experience and motivation. Ability, experience
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The advantage of this ratio is to know the level of profit earned by the company, determine the organization's financial position at a stable level, and increase profit organization.

Disadvantages that can be seen in the profit ratio are if investors or the public know the level of the organization are in good condition is unstable or wobbly. Therefore, investors will not invest in the organization. Thus the ratio of profits to determine which organization is appropriate at the level of both investors and guarantees to ensure that their investment is fully utilized. Investors will also continue and increase their investment in the organization.

Liquidity ratio as the current ratio can determine the financial condition of the organization time to time. The advantages that can be explained as ratio of current assets greater than current liabilities, therefore it will show a stronger financial in organization. Disadvantages that can be viewed if the current ratio was significantly decreased towards the organization insolvent which is the organization can not afford to pay all outstanding debts. This will cause investors afraid to invest in the organization.

Efficiency ratio also involves stock turnover. This ratio can determine where they assess the efficiency of the organization in managing the stock. The ability of an organization is determined when a satisfactory level of stocks, or reflect the