Financial Ratio Analysis Template

Anyone can calculate a current ratio. The difficulty is knowing which ratios matter, how they relate to each other, and which direction is good. This template answers all three.

You enter a single set of P&L and balance sheet figures. Twenty-one ratios come out, grouped into liquidity, profitability, efficiency and leverage, each with a short note saying what it measures and whether higher or lower is the better direction.

The efficiency group includes the cash conversion cycle, which is where most small-business cash problems actually live — money tied up in stock and unpaid invoices while suppliers want paying.

It takes its figures in the same shape as the BabaDigit P&L and Balance Sheet templates, so the three work together.

What you get

• Liquidity: current, quick, cash and working capital ratios
• Profitability: gross, operating and net margin, return on assets and equity
• Efficiency: asset turnover, inventory, receivable and payable days, cash cycle
• Leverage: debt to equity, gearing, interest cover, debt to assets
• A plain-English note on every ratio
• Configurable currency — no currency is hard-coded
• No country’s tax rates or statutory rules built in
• Sheets protected without a password
• No macros, no add-ins, no internet connection required

Who it is for

Owners, managers, lenders and advisers who want to read a set of accounts properly rather than glance at the bottom line.

In the download

• Excel workbook, fully formula-driven
• README with the full usage guide
• Licence covering commercial and client use
• Worked sample data throughout, clearly labelled

Sheets in the workbook

• Instructions — How to use the file, colour key, assumptions and limitations.
• Setup — Currency, business name and the period being analysed.
• Financial Data — The P&L and balance sheet figures the ratios are built from.
• Ratios — Twenty-one ratios in four groups, each with a plain-English note.

Requirements

• Microsoft Excel 2016 or later, or Microsoft 365
• Also opens in LibreOffice Calc, Google Sheets (import) and Apple Numbers
• No macros, no add-ins, no internet connection required

Please read

• Ratios describe a position, they do not explain it. Two businesses with the same current ratio can be in completely different health.
• Industry benchmarks vary enormously and none are built in — comparing against a generic benchmark is usually misleading.
• General information only, not financial, investment or accounting advice.
• Sample data is included and clearly labelled. It is illustrative only.
• This is a tool, not financial, accounting, tax or legal advice.