Discuss the limitations that affect financial statement analysis.
What will be an ideal response?
Answers will vary
The results of financial statement analysis can be difficult to interpret and explain because of differences among industries, changing economic conditions, and the varying accounting principles and estimates made by different companies. Financial statement analysis is useful in giving an overview of a company. Studying a company's financial statements over a period of years and comparing the results to other companies in the same industry can help to reduce the ambiguity associated with the analysis results.
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Fill in the blank(s) with correct word