Auditing Financial Statements: White Sands Bank of Taos

Ratio Analysis
Student’s Name
Institution
Course
Date
RATIO ANALYSIS
To: Paul Jason
From: Loan Officer
Date: 7/11/2019
SUBJECT: AUDITED FINANCIAL STATEMENTS
Jason, I would like to take this opportunity to thank you for considering White Sands Bank of Taos for your 8-year loan for P. Jason Corporation. Financial statements give a summary of the financial standards of the organization. Since your Corporation wishes to expand its operations, you should apply for a loan. Loan processing is very tedious and time-consuming; our best interest is to protect your company. After reviewing the financial documents and information, it is clear that your company has been doing well in the market. But to continue with the loan processing procedures, I will need you to provide extra financial information, most importantly, audited financial statements.
Audited financial statements are very critical when a company is trying to locate creditors and investors. They are required for assurance, completion of reports, accountability, reliability, and feedback. These audited financial statements also enable a company to increase its value and credit ratings. As P. Jason Corporation continues to expand its productivity in the market, the management should ensure there are accurate accounting methods. Auditors must also ensure that the Corporation can follow GAAP standards (Lessambo, 2018). Audited Financial statements are very reliable because they are audited by professionals who have prior knowledge in accounting. With these, banks are given an assurance because the financial information that is presented is free from errors. Audited financial statements provide the status of the business. With this, the organization can attract investors, creditors, and lenders more easily. Therefore, I would like to have your audited information statements sent so that I will be able to review them.
According to the information that you have provided, I have been able to determine the current ration, asset turnover, earnings per share, and the net income of P. Jason Corporation. After the analysis, I can assure you that the company is moving towards the rights direction. This explains why you have been successful in the market. From the information, it is clear that the current ratio increased from 2.1 to 3.1 between 2016 and 2019. This shows that the company has intensified liquidity and short-term debt pay liabilities. The ration is favorable, and this is a clear indication that the company can pay its debts on time. This is very important for creditors. From the information, I can also see that the asset turnover increased from 2.2 t...