Financial Management Practice and Analysis of Enterprises

Common indexes, concepts, and indicators of financial management practices, and analysis of enterprises, are introduced in this chapter. An overview is presented to describe financial statement, the most important tool used to observe and analyze the financial situation of a company. The key financial indexes frequently used to study IC enterprises, like CAPEX, profit and earning, depreciation, and R&D are discussed. Common concepts that will be used in IC enterprises management reports or market reports are introduced, like shipment, ASP, market share, and product category. Three special topics are introduced: Price-to-Earnings ratio is one of the most fundamental indicators to analyze enterprise’s valuations; Goodwill frequently arises from mergers and acquisitions; Equity incentive is an effective complement to a company’s salary system, especially for IC enterprises.