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CHAPTER 1- ABOUT THE COMPANY

Assam Petrochemicals Ltd. (APL) a state Venture Petrochemicals Company, situated at
Namrup is the first of its kinds in India conceived and implemented with Natural gas as basic
raw materials for producing METHANOL and FORMALDEHYDE. Till the beginning of
sixties, Namrup, a slumbering village was a little known to the rest of the country. Discovery
of Oil and Natural gas in Naharkatia region promoted a serious thinking on proper utilization
of gas which has to be otherwise flared up to produce oil consequent upon recommendation
of M/S Snodgrass associates of USA suggestion utilization of this hidden treasure to produce
large number of utilizes including chemical fertilizer and electricity. Then ministry of mines
and fuel appointed a committee to study this. Accordingly, a fertilizer factory was set up and
commissioned on 1968 which is known as Brahmaputra Valley Fertilizer Corporation Ltd. In
the same year a power plant about 150MW capacity, was set up within striking distance from
the fertilizer factory at Namrup which is known as Namrup Thermal Power Station.
It has achieved a breakthrough in the productive utilization of Natural gas in abundance, a
company under the name and style of Assam Petrochemicals Ltd. by Assam Industrial
Development Corporation Ltd. was incorporated in 1971 with 88% equity participation from
the govt. of Assams Chief Minister Mahendra Mohan Chowdhary on 15 th June, 1971 with
technology, design and know and how supplied by M/S Mitshubishi gas chemical company
INC, Japan. Identically this was the second methanol project in the country, when methanol
had to be imported.
In the view of availability, huge reserve of Natural gas in the nearby oil fields and also
increasing national demand of methanol and formalin, the company has taken up 100 tons per
day second methanol plant at Namrup. Its foundation stone was laid by Mr Hiteshwar Saikia,
the then chief minister of Assam on 27th April, 1984. This 2nd methanol plant II with low
pressure technology supply by ICI, London was commissioned in 1989.
Keeping in view in the country and in the neighboring countries the company has set up a
new 100 TPD formalin plant at Namrup. Assams then Chief Minister Late Hiteshwar Saikia
laid the foundation stone of formalin II plant on 20 th February 1996.The commercial
production of the plant was started in the year 1998 with technology, design and know how
supplied by world renowned Derivados Forestales, Netherlands and Spain, is now employed
to produce best quality of formalin.
On 27th August 2012, APL successfully commissioned its revamped 125 TDP Formalin plant
adding a new-feature to its production cap, increasing the production capacity from 100 TDP
to 125 TDP.
Keeping in view the ever swelling demand for Methanol in the country and envisaging the
bright market prospect for Acetic Acid in the Western India, APL has already spurced upto
embark upon the scheme for setting up a 500 TDP Methanol-200 TDP Acetic Acid and a
5MW Capacitive Power Plant (CPP) complex in the adjacent location of existing factory
based on NG as feedstock. The required 0.5 MMSCMD of NG supplied by Oil India Ltd. to

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the New Integrated Methanol-Acetic Acid project will be transported by Assam Gas
Company Ltd. (AGCL). The total project cost is Rs. 1028 crores of which 49% is equity
investment from the Oil India Ltd. and 51% from Govt. of Assam, AGCL & AIDC. M/s. Tata
Consulting Engineers India Ltd. has been engaged as the Project Management Consultant
(PMC) for the implementation of the project.
Now, APL is on its way of opening a new horizon in the Industrial periphery of Assam with
its New Integrated Project, which would usher economic stability, increase production and
productivity and generate indirect employment to many.

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CHAPTER 2- INTRODUCTION
Financial statement analysis is the process of reviewing and evaluating a company's financial
statements (such as the balance sheet or profit and loss statement), thereby gaining an
understanding of the financial health of the company and enabling more effective decision
making. It is an evaluative method of determining the past, current and projected
performance of a company.
1.1 Problem Statement

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CHAPTER 3 LITERATURE REVIEW

1.1 FINANCIAL STATEMENT ANALYSIS - OVERVIEW

According to Myser Financial study analysis is largely a study of relationship among the
various financial factor in the business as disclosed by the single set of statement and a study
of trend of these factor shown in the financial statement.
Financial statement analysis is the process of reviewing and evaluating a company's financial
statements (such as the balance sheet or profit and loss statement), thereby gaining an
understanding of the financial health of the company and enabling more effective decision
making. It is an evaluative method of determining the past, current and projected
performance of a company.
It allows analysts to identify trends by comparing ratios across multiple time periods and
statement types. These statements allow analysts to measure liquidity, profitability, companywide efficiency and cash flow.
1.2 TYPES OF FINANCIAL STATEMENTS
There are three main types of financial statements:
a) Balance Sheet
b) Income Statement
c) Cash Flow Statement.
The balance sheet is a snapshot in time of the company's assets, liabilities and shareholders'
equity. Analysts use the balance sheet to analyze trends in assets and debts. The income
statement begins with sales and ends with net income. It also provides analysts with gross
profit, operating profit and net profit. The cash flow statement provides an overview of the
company's cash flows from operating activities, investing activities and financing activities.
It is used by a variety of stakeholders, such as credit and equity investors, the government,
the public, and decision-makers within the organization. These stakeholders have different
interests and apply a variety of different techniques to meet their needs. For example, equity

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investors are interested in the long-term earnings power of the organization and perhaps the
sustainability and growth of dividend payments. Creditors want to ensure the interest and
principal is paid on the organizations debt securities (e.g., bonds) when due.
1.3 OBJECTIVE OF FINANCIAL STATEMENT ANALYSIS
Financial statement is helpful in assessing the financial position and profitability of the
concern. Keeping in the view of accounting ratio the accountant should calculate the ratio in
appropriate form as early as possible for presentation for management for managerial
decisions.
Following are the main objectives of analysis of financial statements: a) To evaluate the business in terms of profit in present and future.
b) To evaluate the efficiency of various parts or department of the business.
c) To evaluate the short term and long term solvency & liquidity of business.
d) To evaluate the chances of growth of business in the future.
e) To evaluate the inter-firm operational efficiency with comparative statements.
f) To evaluate the financial and economical stability of the business.
1.3.1 IMPORTANCE OF ANALYSIS OF FINANCIAL STATEMENT
Financial statement is prepared at a certain point of time according to established convention.
For measuring the financial soundness, efficiency, profitability and future prospects of the
concern, it is necessary to analyze the financial statement. Following purposes are served by
the Financial analysis: a) Help in Evaluating the operational efficiency of the Concern:- It is necessary to analyze
the financial statement for matching the total expenses of the current year comparing with
the total expenses of the previous year and evaluate the managerial efficiency of concern.
b) Help in Evaluating the short and long term financial position:-It is necessary to analyze
the financial statement for comparing the current assets and current liabilities to evaluate
the short term and long term financial soundness.
c) Help in calculating the profitability:-It is necessary to analyze the financial statement to
know the gross profit and net profit.
d) Help in indicating the trend of achievements:- It helps in trend analysis of the firm and
the achievements of the organisation.

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e) Forecasting, budgeting and deciding future line of action:-The potential growth of the
business can be predicts by the analysis of financial statement which helps in deciding
future line of action. Comparisons of actual performance with target show all the
shortcomings.
1.4 LIMITATIONS OF FINANCIAL ANALYSIS
a) It is Suffering from the limitations of financial statements
b) There is Absence of standard universally accepted terminology in financial analysis
c) price level changes is ignored in financial analysis
d) quantity aspect is ignored in financial analysis
e) Financial analysis provides misleading result in absence of absolute data
1.5 METHODS OF FINANCIAL STATEMENT ANALYSIS
There are two key methods for analyzing financial statements.

Horizontal analysis

Vertical analysis

Horizontal analysis is the comparison of historical financial information over a series of

reporting periods, or of the ratios derived from this financial information. The intent is to see
if any numbers are unusually high or low in comparison to the information for bracketing
periods, which may then trigger a detailed investigation of the reason for the difference. The
analysis is most commonly a simple grouping of information that is sorted by period, but the
numbers in each succeeding period can also be expressed as a percentage of the amount in the
baseline year, with the baseline amount being listed as 100%.
Vertical analysis is the proportional analysis of a financial statement, where each line item on
a financial statement is listed as a percentage of another item. Typically, this means that every
line item on an income statement is stated as a percentage of gross sales, while every line
item on a balance sheet is stated as a percentage of total assets.
1.6 WHAT IS THE 'RATIO ANALYSIS'?

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A ratio analysis is a quantitative analysis of information contained in a companys financial

statements. Ratio analysis is based on line items in financial statements like the balance sheet,
income statement and cash flow statement; the ratios of one item or a combination of items
- to another item or combination are then calculated. Ratio analysis is used to evaluate
various aspects of a companys operating and financial performance such as its efficiency,
liquidity, profitability and solvency. The trend of these ratios over time is studied to check
whether they are improving or deteriorating. Ratios are also compared across different
companies in the same sector to see how they stack up, and to get an idea of comparative
valuations. Ratio analysis is a cornerstone of fundamental analysis.
While there are numerous financial ratios, most investors are familiar with a few key ratios,
particularly the ones that are relatively easy to calculate. Some of these ratios include the
current ratio, return on equity, the debt-equity ratio, the dividend payout ratio and the
price/earnings (P/E) ratio.
For a specific ratio, most companies have values that fall within a certain range. A company
whose ratio falls outside the range may be regarded as grossly undervalued or overvalued,
depending on the ratio.
As well, ratios are usually only comparable across companies in the same sector, since an
acceptable ratio in one industry may be regarded as too high in another. For example,
companies in sectors such as utilities typically have a high debt-equity ratio, but a similar
ratio for a technology company may be regarded as unsustainably high.
Ratio analysis can provide an early warning of a potential improvement or deterioration in a
companys financial situation or performance. Analysts engage in extensive numbercrunching of the financial data in a companys quarterly financial reports for any such hints.
Successful companies generally have solid ratios in all areas, and any hints of weakness in
one area may spark a significant sell-off in the stock. Certain ratios are closely scrutinized
because of their relevance to a certain sector, as for instance inventory turnover for the retail
sector and days sales outstanding (DSOs) for technology companies.
1.6.1 TYPES OF RATIOS

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On the basis of function or test, the ratios are classified as liquidity ratios, profitability ratios,
activity ratios and solvency ratios.
1. Liquidity Ratios:
Liquidity ratios measure the adequacy of current and liquid assets and help evaluate the
ability of the business to pay its short-term debts. The ability of a business to pay its shortterm debts is frequently referred to as short-term solvency position or liquidity position of the
business. Generally a business with sufficient current and liquid assets to pay its current
liabilities as and when they become due is considered to have a strong liquidity position and a
businesses with insufficient current and liquid assets is considered to have weak liquidity
position.
Four commonly used liquidity ratios are given below:
Current ratio or working capital ratio
Quick ratio or acid test ratio
Absolute liquid ratio
Current cash debt coverage ratio
2. Profitability ratios:
Profitability ratios measure the efficiency of management in the employment of business
resources to earn profits. These ratios indicate the success or failure of a business enterprise
for a particular period of time.Creditors, financial institutions and preferred stockholders
expect a prompt payment of interest and fixed dividend income if the business has good
profitability position.Management needs higher profits to pay dividends and reinvest a
portion in the business to increase the production capacity and strengthen the overall financial
position of the company.
Some important profitability ratios are given below:
Net profit (NP) ratio
Gross profit (GP) ratio
Price earnings ratio (P/E ratio)
Operating ratio
Expense ratio
Dividend yield ratio
Dividend payout ratio
Return on capital employed ratio

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Earnings per share (EPS) ratio

Return on shareholders investment/Return on equity
Return on common stockholders equity ratio
3. Activity ratios:
Activity ratios (also known as turnover ratios) measure the efficiency of a firm or company in
generating revenues by converting its production into cash or sales. It shows how frequently
the assets are converted into cash or sales and, therefore, are frequently used in conjunction
with liquidity ratios for a deep analysis of liquidity.
Some important activity ratios are:
Inventory turnover ratio
Receivables turnover ratio
Average collection period
Accounts payable turnover ratio
Average payment period
Asset turnover ratio
Working capital turnover ratio
Fixed assets turnover ratio
4. Solvency ratios:
Solvency ratios (also known as long-term solvency ratios) measure the ability of a business to
survive for a long period of time. These ratios are very important for stockholders and
creditors and are used to analyze the capital structure of the company, evaluate the ability of
the company to repay debt & its finance charges etc
Some frequently used long-term solvency ratios are given below:
Debt to equity ratio
Times interest earned (TIE) ratio
Proprietary ratio
Fixed assets to equity ratio
Current assets to equity ratio
Capital gearing ratio

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1.7 DESCRIPTION OF RATIOS:

a. What is Quick Ratio?
The quick ratio is an indicator of a companys short-term liquidity. The quick ratio measures
a companys ability to meet its short-term obligations with its most liquid assets. For this
reason, the ratio excludes inventories from current assets, and is calculated as follow
Quick ratio = (current assets inventories) / current liabilities,
Or
= (cash and equivalents + marketable securities + accounts receivable) / current liabilities.
The quick ratio is more conservative than the current ratio because it excludes inventories
from current assets. The ratio derives its name presumably from the fact that assets such as
cash and marketable securities are quick sources of cash. Inventories generally take time to
be converted into cash, and if they have to be sold quickly, the company may have to accept a
lower price than book value of these inventories. As a result, they are justifiably excluded
from

assets

that

are

ready

sources

of

immediate

cash.

The acid test or quick ratio should be 1:1 or higher, however this varies widely by industry. In
general, the higher the ratio, the greater the company's liquidity (i.e., the better able to meet
current obligations using liquid assets).
b. What is the 'Current Ratio'?
The current ratio is a liquid ratio that measures a company's ability to pay short term and long
term obligations. To gauge this ability, the current ratio considers the current total assets of a
company (both liquid and illiquid) relative to that companys current total liabilities.
The formula for calculating a companys current ratio, then, is:

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Current Ratio = Current Assets / Current Liabilities

The current ratio is mainly used to give an idea of the company's ability to pay back its
liabilities (debt and accounts payable) with its assets (cash, marketable securities,
inventory,accounts receivable). As such, current ratio can be used to take a rough
measurement of a companys financial help. The higher the current ratio, the more capable
the company is of paying its obligations, as it has a larger proportion of asset value relative to
the value of its liabilities. A ratio under 1 indicates that a companys liabilities are greater
than its assets and suggests that the company in question would be unable to pay off its
obligations if they came due at that point. While a current ratio below 1 shows that the
company is not in good financial health, it does not necessarily mean that it will go bankrupt..
On the other hand, a high ratio (over 3) does not necessarily indicate that a company is in a
state of financial well-being either. Depending on how the companys assets are allocated, a
high current ratio may suggest that that company is not using its current assets efficiently, is
not securing financing well or is not managing its working capital well.
c. What is the 'Cash Ratio'?
The cash ratio or cash coverage ratio is a liquidity ratio that measures a firm's ability to pay
off its current liabilities with only cash and cash equivalents. The cash ratio is much more
restrictive than the current ratio or quick ratio because no other current assets can be used to
pay off current debt--only cash.
The cash asset ratio is the current value of marketable securities and cash, divided by the
company's current liabilities. Also known as the cash ratio, the cash asset ratio compares the
amount of highly liquid ratio (such as cash and marketable securities) for every one dollar of
short-term liabilities. This figure is used to measure a firm's liquidity or its ability to pay its
short-term obligations. Ideal ratios will be different for different industries and for different
sizes of corporations, and for many other reasons.
Formula

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The cash asset ratio is similar to the current ratio, except that the current ratio includes
current assets such as inventories in the numerator.
The cash ratio shows how well a company can pay off its current liabilities with only cash
and cash equivalents. This ratio shows cash and equivalents as a percentage of current
liabilities.
d. What is 'Working Capital?'
Working capital is a measure of both a company's efficiency and its short-term financial
health. Working capital is calculated as:
Working Capital = Current Assets - Current Liabilities
The working capital ratio (Current Assets/Current Liabilities) indicates whether a company
has enough short term assets to cover its short term debt. Anything below 1 indicates negative
W/C (working capital). While anything over 2 means that the company is not investing
excess assets. Most believe that a ratio between 1.2 and 2.0 is sufficient. Also known as "net
working capital".
If a company's current assets do not exceed its current liabilities, then it may run into trouble
paying back creditors in the short term. The worst-case scenario is bankruptcy. A declining
working capital ratio over a longer time period could also be a red flag that warrants further
analysis. For example, it could be that the company's sales volumes are decreasing and, as a
result, its accounts receivables number continues to get smaller and smaller. Working capital
also gives investors an idea of the company's underlying operational efficiency. Money that is
tied up in inventory or money that customers still owe to the company cannot be used to pay
off any of the company's obligations. So, if a company is not operating in the most efficient
manner (slow collection), it will show up as an increase in the working capital. This can be
seen by comparing the working capital from one period to another; slow collection may
signal an underlying problem in the company's operations.

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e. What is Equity Ratio ?

The equity ratio is a financial ratio indicating the relative proportion of equity used to finance
a company's assets. The two components are often taken from the firm's balance sheet or
statement of financial position (so-called book value), but the ratio may also be calculated
using market values for both, if the company's equities are publicly traded.
The Equity Ratio is a good indicator of the level of leverage used by a company. The Equity
Ratio measures the proportion of the total assets that are financed by stockholders, as
opposed to creditors. A low equity ratio will produce good results for stockholders as long as
the company earns a rate of return on assets that is greater than the interest rate paid to
creditors.
f. What is the 'Debt to Equity Ratio?'
The debt to equity ratio is a financial, liquidity ratio that compares a company's total debt to
total equity. The debt to equity ratio shows the percentage of company financing that comes
from creditors and investors. A higher debt to equity ratio indicates that more creditor
financing (bank loans) is used than investor financing (shareholders).
Formula
The debt to equity ratio is calculated by dividing total liabilities by total equity. The debt to
equity ratio is considered a balance sheet ratio because all of the elements are reported on the
balance sheet.

Each industry has different debt to equity ratio benchmarks, as some industries tend to use
more debt financing than others. A debt ratio of .5 means that there are half as many liabilities
than there is equity. A debt to equity ratio of 1 would mean that investors and creditors have
an equal stake in the business assets.

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A lower debt to equity ratio usually implies a more financially stable business. Companies
with a higher debt to equity ratio are considered more risky to creditors and investors than
companies with a lower ratio. Unlike equity financing, debt must be repaid to the lender.
Since debt financing also requires debt servicing or regular interest payments, debt can be a
far more expensive form of financing than equity financing. Companies leveraging large
amounts of debt might not be able to make the payments.
Creditors view a higher debt to equity ratio as risky because it shows that the investors
haven't funded the operations as much as creditors have. In other words, investors don't have
as much skin in the game as the creditors do. This could mean that investors don't want to
fund the business operations because the company isn't performing well. Lack of
performance might also be the reason why the company is seeking out extra debt financing.
g. What is Gross Profit Ratio?
Gross profit ratio (GP ratio) is a profitability ratio that shows the relationship between gross
profit and total net sales revenue. It is a popular tool to evaluate the operational performance
of the business. The ratio is computed by dividing the gross profit figure by net sales.
The following formula/equation is used to compute gross profit ratio:

Gross profit is very important for any business. It should be sufficient to cover all expenses
and provide for profit.
The ratio can be used to test the business condition by comparing it with past years ratio and
with the ratio of other companies in the industry. A consistent improvement in gross profit
ratio over the past years is the indication of continuous improvement . When the ratio is
compared with that of others in the industry, the analyst must see whether they use the same
accounting systems and practices
h. What is Net Profit Ratio?

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Net profit ratio (NP ratio) is a popular profitability ratio that shows relationship between net
profit after tax and net sales. It is computed by dividing the net profit (after tax) by net sales.
Formula:

For the purpose of this ratio, net profit is equal to gross profit minus operating expenses and
income tax. All non-operating revenues and expenses are not taken into account because the
purpose of this ratio is to evaluate the profitability of the business from its primary
operations. Examples of non-operating revenues include interest on investments and income
from sale of fixed assets. Examples of non-operating expenses include interest on loan and
loss on sale of assets.
Significance and Interpretation:
Net profit (NP) ratio is a useful tool to measure the overall profitability of the business. A
high ratio indicates the efficient management of the affairs of business.
There is no norm to interpret this ratio. To see whether the business is constantly improving
its profitability or not, the analyst should compare the ratio with the previous years ratio, the
industrys average and the budgeted net profit ratio.
The use of net profit ratio in conjunction with the assets turnover ratio helps in ascertaining
how profitably the assets have been used during the period

i. What is return on Working Capital?

The return on working capital ratio compares the earnings for a measurement period to the
related amount of working capital. This measure gives the user some idea of whether the
amount of working capital currently being used is too high, since a minor return implies too

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large an investment. To calculate the return on working capital, divide profit before interest
and taxes for the measurement period by working capital. The formula is:
Profit/loss

before

interest

and

taxes

Current assets - Current liabilities

= Return on working capital

j. What is 'Return on Equity - ROE'?

Return on equity (ROE) is the amount of net income returned as a percentage of shareholders
equity. Return on equity measures a corporation's profitability by revealing how much profit a
company generates with the money shareholders have invested.
ROE is expressed as a percentage and calculated as:
Return on Equity = Net Income/Shareholder's Equity
k. What is 'Asset Turnover Ratio'
Asset turnover ratio is the ratio of the value of a companys sales or revenues generated
relative to the value of its assets. The Asset Turnover ratio can often be used as an indicator of
the efficiency with which a company is deploying its assets in generating revenue.
Asset Turnover = Sales or Revenues / Total Assets
Generally speaking, the higher the asset turnover ratio, the better the company is performing,
since higher ratios imply that the company is generating more revenue per dollar of
assets. Yet, this ratio can vary widely from one industry to the next. As such,
considering the asset turnover ratios of an energy company and a telecommunications
company will not make for an accurate comparison. Comparisons are only meaningful
when they are made for different companies within the same sector.
l. What is the 'Receivables Turnover Ratio'

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An accounting measure used to quantify a firm's effectiveness in extending credit and in

collecting debts on that credit. The receivables turnover ratio is an activity ratio measuring
how efficiently a firm uses its assets.
Receivables turnover ratio can be calculated by dividing the net value of credit sales during a
given period by the average accounts receivable during the same period. Average accounts
receivable can be calculated by adding the value of accounts receivable at the beginning of
the desired period to their value at the end of the period and dividing the sum by two.
The method for calculating receivables turnover ratio can be represented with the following
formula:

The receivables turnover ratio is most often calculated on an annual basis, though this can be
broken down to find quarterly or monthly accounts receivable turnover as well.
BREAKING DOWN 'Receivables Turnover Ratio'
Receivable turnover ratio is also often called accounts receivable turnover, the accounts
receivable turnover ratio or the debtors turnover ratio. In essence, the receivables
turnover ratio indicates the efficiency with which a firm manages the credit it issues to
customers and collects on that credit. Because accounts receivable are moneys owed on a
credit agreement without interest, by maintaining accounts receivable firms are indirectly
extending interest-free loans to their clients. As such, because of the time value of money
principle, a firm loses more money the longer it takes to collect on its credit sales.
m. What is 'Inventory Turnover'
Inventory turnover is a ratio showing how many times a company's inventory is sold and
replaced over a period of time. The days in the period can then be divided by the inventory
turnover formula to calculate the days it takes to sell the inventory on hand. It is calculated as
sales divided by average inventory.
n. What is an 'Operating Margin'

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Operating margin is a margin ratio used to measure a company's pricing strategy and
operating efficiency.
Operating margin is a measurement of what proportion of a company's revenue is left over
after paying for variable costs of production such as wages, raw materials, etc. It can be
calculated by dividing a companys operating income (also known as "operating profit")
during a given period by its net sales during the same period. Operating income here refers
to the profit that a company retains after removing operating expenses (such as cost of goods
sold and wages) and depreciation. Net sales here refers to the total value of sales minus the
value of returned goods, allowances for damaged and missing goods, and discount sales.

Operating margin is expressed as a percentage, and the formula for calculating operating
margin can be represented in the following way:

Operating margin is also often known as operating profit margin, operating income
margin, return on sales or as net profit margin. However, net profit margin may be
misleading in this case because it is more frequently used to refer to another ratio, net margin.
o. What is the 'Receivables Turnover Ratio'
An accounting measure used to quantify a firm's effectiveness in extending credit and in
collecting debts on that credit. The receivables turnover ratio is an activity ratio measuring
how efficiently a firm uses its assets.
Receivables turnover ratio can be calculated by dividing the net value of credit sales during a
given period by the average accounts receivable during the same period. Average accounts
receivable can be calculated by adding the value of accounts receivable at the beginning of
the desired period to their value at the end of the period and dividing the sum by two.
The method for calculating receivables turnover ratio can be represented with the following
formula:

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The receivables turnover ratio is most often calculated on an annual basis, though this can be
broken down to find quarterly or monthly accounts receivable turnover as well.
Receivable turnover ratio is also often called accounts receivable turnover, the accounts
receivable turnover ratio or the debtors turnover ratio.