CFA Level I · CFA Level I Exam · Introduction to Financial Statement Analysis
In the financial statement analysis framework, the step an analyst performs immediately after collecting input data and before analyzing the data is most likely to:
The analyst most likely processes the data next. In the framework, after input data are collected, they are adjusted and converted into ratios, common-size statements or charts before being analyzed and interpreted. Stating the objective comes first, and communicating conclusions comes near the end.
- Aprocess the dataCorrect
- Bstate the objective
- Cdevelop and communicate conclusions
Explanation
The framework steps are: articulate the purpose and context, collect input data, process the data, analyze and interpret the data, develop and communicate conclusions, and follow up. Processing the data (adjustments, ratios, charts) follows data collection and precedes analysis. Stating the objective is the first step, and communicating conclusions comes later.
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