An Analyst Is Trying to Value an Advertising Agency

question 28

Multiple Choice

An analyst is trying to value an advertising agency.The company recently announced the hiring of three well-known accounts managers from a rival agency.Which of the following limitations of financial ratios will hinder the valuation of the agency the most?

• A)Financial statements are historical.
• B)Managers prepare financial statements.
• C)Financial statements are not comprehensive.
• D)Financial statements are not the only source of information.

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