Businesses in the world can be categorized in to two parts mainly; profit oriented and non-profit oriented. Regardless of the profit oriented motive or social welfare motive, financial
performance
plays a key
role
in an organization in the path
to achieve their goals. Information regarding financial performance will shape the
decisions
regarding
the
future of
the organization.
That is why accounting has been evolving to cater the financial information needs of the business organizations
around the world, providing information about financial performance to enable better decision making. Financial ratios can be mentioned as an accounting tool which will help
the
various
decision makers
to take
decisions regarding the financial performance of the company. Financial ratios will enable the managers to assess the organizations’
operations, growth, and benchmark the organization
with its competitors. Analyzing the ratios will also help them in planning future performance by taking the current period’s performance into consideration.
According
to Erdogan
et Al. (2015)[5], analyzing the financial ratios and performance becomes one of the main responsibilities of the managers due to the above
reasons. Green
(1978)[6] has mentioned in
his study,
that
financial ratios of the
failed firms
differed from the successful firms as early as five years prior to the failure. Therefore, to avoid bankruptcy, it is important to analyze the financial ratios of a business organization. The aim
of this
study
is to
analyze
the
relationship between some of the financial ratios and the
