Sunday, September 21, 2008

financial health indicators

As we see in the reading that there are indicators for economic health and financial health (Picard, p.230), I think it is harder for me to identify financial health indicators now. The numbers are very overwhelming. Here's why I started looking at GOOG's balance sheet:

In Business Week's Best Brands of 2008, Google ranks the 10th, a huge jump from the 20th of 2007 ranking.The brand value is $25.6 billion, which is a 43% increase from 2007. After reading the chapters, I want to know what does this $25.6 billion mean, so I started looking through GOOG's balance sheet.

For me, economic indicators seem to be more straightforward. For example, for economic health, when ComScore reported that google's search engine share increased from 61.9% to 63% within a month, it seems to me to be a growth in market share: an indicator for economic growth.

Picard's chapters are helpful in terms of explaining financial indicators, such as the definitions of assets, liabilities, and debt, but applying those to real world is difficult.

In Millions of USD (except for per share items)
As of 2008-06-30 As of 2008-03-31 As of 2007-12-31 As of 2007-09-30 As of 2007-06-30






Total Current Assets 16,316.84 15,464.93 17,289.14 15,733.76 14,857.52
Total Assets 29,179.79 27,604.98 25,335.81 23,340.65 21,423.88

The table is obtained from Google Finance. As you can see for GOOG, there are total current assets and total assets. I am not exactly sure which one to look at when or which one is more important when deciding if a company is financially healthy. There are some ups and downs for total current assets and the total assets grow constantly. I think overall it looks pretty good? But I still did not find where the $25.6 billion (in Business Week) come from......

1 comment:

iris said...

Def. of current assets: http://www.investorwords.com/1245/current_assets.html