Research On The Financial Analysis Of Midea Based On The Improved Du Pont Analysis System

With the rapid economic development and the intensification of economic globalization,enterprises are facing more international competition.Since 2014,China has actively promoted the “Belt and Road” economic co-construction.For Chinese enterprises,this is a rare opportunity and a huge challenge.Increasing competition not only tests the company’s operating capabilities,but also increases the company’s operating risks.Therefore,a comprehensive analysis of the company’s financial situation and an accurate assessment of the company’s operating capabilities are crucial to the company’s development.The Du Pont analysis system can comprehensively reflect the financial status and operating capabilities of the enterprise through a comprehensive analysis of the company’s profitability,operating capacity,and debt solvency.However,with the intensification of competition in the economic market,the company’s business activities continue to increase,and the company’s requirements for financial analysis results are becoming more and more stringent.The Du Pont analysis system can no longer meet the needs of modern enterprises.Therefore,in order to comprehensively and accurately assess the financial status and operating capabilities of modern enterprises,it is of far-reaching practical significance to improve the Du Pont analysis system and make it a financial analysis method that is more suitable for the current economic environment.This article first discusses the framework and significance of the Du Pont analysis system before and after improvement,which shows that although the Du Pont analysis system has advantages,its limitationscannot be ignored.Secondly,in light of its limitations,it is improved by introducing cash flow indicators and sustainable growth rate indicators.Finally,taking Midea Company as an example,the Du Pont analysis system before and after the improvement was used to perform financial analysis on its 2015-2019 financial statements.By comparing its operating capabilities,the differences between the two were found to reflect Midea ’s financial At the same time as the status and operating capabilities,it highlights the advantages of the improved system.In this paper,through systematic research before and after the improvement of Du Pont analysis system,the purpose is to demonstrate that compared with the traditional Du Pont analysis system,the improved system is more suitable for the current economic environment and has more general practicality.