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How to Read Financial Statements

작성자HANBAT HERALD
조회수154
How to Read Financial StatementsBy Kim Hyun-hee Reporter, Senior of AccountingKOSPI is a stock index calculated based on the changes in the Korea Exchange, and it serves as arepresentative indicator of the flow of the Korean economy and stock markets. KOSPI exceeded 3,200 for the first time in three years and ten months, amid expectations of the Bank of Koreas interest rate cut, the governments supplementary budget and policies supporting the stock market. As a result, individual investors interest in stocks has also increased. The number of stock accounts rose by more than 1 million, while the average daily trading by individual investors increased by 30.55 percent for purchases and 32.1 percent for sales. As transactions expand, the liquidity of the stock market, which affects the formation of market prices. So, let us learn to way of the companys investment.Financial StatementsInvestors can use financial statements to estimate future cash flows and assess a companys financial health. Financial Statements include the Statement of Financial Position, Income Statement, Cash Flow Statement, Statement of Changes in Equity, and Notes.The statement of financial position offers information on assets, liabilities, and equity. Assets refer to economic resources controlled by companies because of past events. Assets include cash and cash equivalents, accounts receivable from sales of goods or services.Debts are present obligations of the company to transfer economic resources arising from past transactions. For example, they include accounts payable for credit purchases, advances received from customers before goods are delivered, and bonds payable issued to raise funds. Equity is calculated by taking away liabilities from assets. Equity includes paid-in capital, which is the total par value of shares issued by the company, and capital surplus arising from capital transactions. As such, the statement of financial position shows the companys financial structure at a specific point in time.In contrast, the income statement reflects a companys operating performance over a specific period by reporting revenues and expenses. Revenues represent increases in assets or decreases in liabilities that result in an increase in equity, whereas expenses represent decreases in assets or increases in liabilities that reduce equity.The cash flow statement illustrates cash inflows and outflows from operating, investing, and financing activities, and is used to assess a companys actual cash-generating ability.The Statement of Changes in Equity provides details on the size and composition of equity, as well as changes due to events like capital increases or dividends. Finally, the Notes clarify accounting policies, provide detailed breakdowns, and identify potential risks, all of which are essential for a comprehensive understanding of the financial statements.These statements are accessible through the DART (https://dart.fss.or.kr/). They are issued periodically: annual (one year), semi-annual (six months), and quarterly (three months). These reports contain critical information such as changes in capital, company and business overview, risk management, major contracts, bonds, and corporate tax expenses. By analyzing these documents, investors can gauge a companys financial soundness and evaluate its performance. This enables them to formulate investment strategies by comparing the company with other companies in similar industries.Key Investment IndicatorsSeveral investment indicators, derived from financial statements, are used to analyze companies. First, the Price to Earnings Ratio (PER) is calculated by dividing a companys current stock price by its earnings per share (EPS).It indicates how many times the stock price is compared to the EPS. A higher PER relative to similar industries may suggest the company is overvalued. On the other hand, a lower PER could indicate an undervalued stock or a company in its early stages with high Rs net assets available to common shareholders after converting the companys assets into their book value as recorded on the financial statements, and after subtracting preferred stock (shares with limited voting rights) and all liabilities, by the number of outstanding common shares (shares with voting rights).PBR shows how many times a stock trades relative to its book value per share. A PBR of 1 means the stock price equals its book value; below 1 suggests undervaluation, and above suggests overvaluation. However, PBR alone does not guarantee a companys financial soundness, as book value may not reflect the true market value of assets. In short, PBR is primarily an indicator used to evaluate stock prices based on a companys financial health, while PER is used to assess stock prices in relation to profitability.A companys total capital consists of equity, which is funds raised from issuing shares, and debt, which is funds borrowed from external sources.ROE represents how effectively management uses shareholders' capital to generate profits, calculated by dividing net income from the income statement by total equity. ROE indicates how effectively a company uses its own capital to earn profit. A high ROE tends to be associated with higher stock prices. ROE is a key financial ratio used to measure overall business performance. Conversely, a low ROE may indicate poor company performance or a struggling industry.Company AnalysisLet's analyze which companies might be a better investment through financial statements as a hypothetical company.ABCStock price (KRW)50,00080,00030,000Earnings per share (KRW)5,0002,0004,000Net assets per share (KRW)25,00080,00060,000Net income (KRW 100 million)5,0002,5003,000Equity capital (KRW 100 million)25,00050,00040,000From these figures, we can calculate PER, PBR, and ROE as follows:ABCPER(Price to Earnings Ratio)10407.5PBR(Price-To-BookRatio)2.01.00.5ROE(Return On Equity)20%5%7.5%Assuming companies A, B, C belong to the same industry. Company B has the highest PER, suggesting its stock price is high relative to its EPS, potentially indicating overvaluation. Company C has the lowest PER, and PBR, which might suggest it is undervalued or in an early investment stage with high Rs stock price equals its book value. Company A boasts the highest ROE, indicating the most efficient use of shareholder capital to generate profits. In this case, investors may choose the company according to their personal inclinations. Those who prefer undervalued companies might consider Company C, as its low PER and PBR suggest it is undervalued relative to its EPS and book value. However, its lower profit growth compared to A necessitates a review of its operational performance and profitability. Aggressive investors seeking growth stocks might opt for Company B, which has the highest PER. This reflects market expectations for future growth despite a high stock price relative to current EPS. Therefore, investors should assess current performance and future growth potential when deciding whether to invest. Finally, Conservative investors seeking stability might choose Company A for its high ROE, reflecting consistent profitability. Thus, investors use these indicators to determine which companies to invest in and to what extent.Other Considerations for InvestmentIn addition to these investment indicators, you can also refer to the ratio that shows a company's financial soundness and liquidity. For example, a high current ratio indicates sufficient ability to repay current liabilities. A high quick ratio indicates that a company has sufficient cash and cash equivalents, reducing its short-term financial risk. A high net working capital ratio suggests current assets exceed current liabilities, ensuring stable funding for operations. A low debt ratio indicates less reliance on borrowing and stable capital utilization. Lastly, a low non-current ratio indicates that current assets account for a larger proportion than long-term assets.Warren Buffett advised to invest long-term in companies with intrinsic value higher than their market price and to invest in what you know. Ultimately, the most crucial things are a company's future growth potential and inherent capabilities. Additionally, assessing whether a stock is overvalued, financial soundness, cash management and debts levels will significantly aid investment decisions.https://www.mk.co.kr/news/stock/11370848https://www.mk.co.kr/news/world/11308403https://www.moef.go.kr/sisa/dictionary/detail?idx=191https://www.moef.go.kr/sisa/dictionary/detail?idx=210https://eiec.kdi.re.kr/material/clickView.do?click_yymm=201512&cidx=1069https://www.chosun.com/economy/money/2025/07/11/NZXWQXFM7FD4ZDSXNTEBSHL3X4Kim, S.-J. (2023). A Study on the Effect of Corporate Financial Stability on Stock Returns. Journal of CEO and Management Studies, 26(2), 293-313.
등록일2025-12-22 14:32:52

Han Kang and the Nobel Prize in Literature

작성자HANBAT HERALD
조회수565
Han Kang and the Nobel Prize in LiteratureBy Lee Han-na Reporter, Junior of Chemical and Biological EngineeringKoreans cannot win the Nobel Prize in Literature. The main character, Na-young, from the movie Past Lives left Korea with this belief. However, on December 10th, 2024, the first Nobel Prize in Literature winner from Korea was announced. After the announcement that Han Kang was awarded the Nobel Prize, readers flocked to the bookstores to buy her books, and all of her books sold out within six days. How did Han Kang become both the first Korean, as well as the first Asian woman to win the Nobel Prize in Literature?What is it about her work that moved readers all around the world?Author Han KangIn 1970, Han Kang, born in Gwangju City, is the daughter of the novelist Han Seung-won. She grew up in an environment where literature is at hand. After moving to Seoul with her family, she majored in the Department of Korean language and literature at Yonsei University to gain ground in literature.Han Kang made her debut as a poet after graduating from university in 1993. She published four poems in the 24th issue of the quarterly magazine Literature and Society while also working as a journalist for a cultural magazine. The following year, in 1994, she officially debuted as a novelist when her short story titled 「Red Anchor」 won the Seoul Newspaper New Years Literary Contest. Since then, Han Kang has solidified her position in a Korean literature by publishing a variety of works, including 「Yeosu」, 「Fruits of My Woman」, 「Your Cold Hand」, 「Black Deer」, 「The Wind Blows, Go」, and others. In 2005, she won the Yi Sang Literary Award, one of Koreas most prestigious literary prizes, marking the first record that a father and daughter had both received the award. Furthermore, in 2016, she gained international recognition as the first Asian author to win the Man Booker International Prize with 「The Vegetarian」. Continuing her global success, her 2021 novel 「I Do Not Bid Farewell」 made her the first Korean writer to receive the 2023 Prix Mdicis tranger in France, as well as the mile Guimet Prize for Asian Literature.In addition to her writing, Han Kang taught fiction writing at the Creative Writing of the Seoul Institute of the Arts from 2016 to 2018. Her students described her as a professor with a delicate yet intense sensibility.The Nobel Prize in LiteratureIn accordance with Alfred Nobels will, the Nobel Prize in Literature is awarded to an author who has xss-created works that present the most ideal direction in the field of literature. The prize not only recognizes outstanding literary quality but also considers the social messages that the writer has consistently conveyed through their works. The Swedish Academy, which decides the prize winner, stated that Han Kang was awarded the Nobel Prize in Literature for her intense poetic prose that confronts historical trauma and exposes the fragility of human life. This recognition stems from her profound exploration of the body and mind, life and death, as well as her delicate portrayal of violence, wounds, and the process of healing. Han Kang has demonstrated an exceptional ability in combining historical events in Korea with personal experiences, transforming them into a universal human narrative through literature. She was reportedly having dinner with her son and enjoying an ordinary evening when she received news of the award, and was said to be taken aback by the unexpected announcement.Representative Works「The Vegetarian」: Can a person ever be completely innocent from violence?「The Vegetarian」, which won the Man Booker International Prize, is a novel that raises fundamental questions about violence and human existence, portraying every character as a perpetrator of varying degrees of violence.The novel is structured to depict the protagonist, Yeong-hye, through three different perspectives:- Part 1: The VegetarianFrom the viewpoint of Yeong-hyes selfish husband, this section portrays his discomfort as his wife unexpectedly declares her commitment to vegetarianism. Because of his expectation on her to remain an unremarkable and obedient wife, he fails to understand her transformation, resulting in ultimately isolating her.- Part 2: Mongolian MarkThis section explores the crossing of moral boundaries as Yeong-hyes brother-in-law, an artist, becomes obsessed with her body under the pretext of art. His desire leads to another form of violence, exploiting her vulnerability.- Part 3: Flaming TreesThe final section shifts to the perspective of Yeong-hyes older sister, In-hye, who watches as Yeong-hye abandons her humanity, yearning to become a plant. Despite her concern, In-hye ultimately deems her as mentally ill and sends her to a psychiatric hospital, becoming another agent of violence.No one can understand me Doctors and Nurses are all the same They do not even try to understand Just giving medicines and injections.Did Young-hye endure and move past the pain and sleepless nights that she is secretly having, at faster speed than most people?Part 3 naturally draws attention as it highlights the contrast between the two sisters, In-hye and Yeong-hye, in how they cope with violence and oppression despite growing up in the same household. Raised under a violent and patriarchal father, In-hye survived by conforming to his expectations and avoiding direct violence by being obedient. In contrast, Yeong-hye could not escape and fully absorbed the violence, experiencing it in its most direct and brutal form. In-hye represents a person who chooses to compromise with social expectations, appearing to live a relatively stable and untroubled life. However, as she observes Yeong-hye rejecting conventional norms and following her inner voice, she begins to recognize her lifelong submission to the social order. This realization forces her to confront the extent to which she has suppressed her desires and freedom in order to conform to social expectations.This novel powerfully illustrates how defining others through language is, in itself, an act of violence. Yeong-hye is labeled as the ordinary wife her husband desires, the normal woman who does not deviate from societal prejudices, the good daughter who obediently follows her fathers authority, and the mentally ill person in need of treatment. However, her own will is never considered. Ultimately, 「The Vegetarian」 dissects the relationship between the normality defined by society and the violence inherent within it, prompting readers to reconsider the meaning of violence and oppression.「Greek Lessons」: What part of humanity is truly worthy of our attention and love?「Greek Lessons」 is a novel that captures a fleeting moment in which a woman who is losing her ability to speak and a man who is gradually losing his sight, each living in solitude, come to encounter one another. As a child, the woman loses her ability to speak without any signs. Later, she experiences divorce and the loss of custody, sinking even deeper into silence. She eventually decides to learn Ancient Greek, a long-dead language no longer in use, and paradoxically finds comfort within it. The Greek teacher is a man who left his family in Germany and returned alone to Korea. As he gradually loses his sight, he descends further into darkness. One day, through a coincidence, these two people attempt to communicate in their own ways.Doesn't it feel strangely unsettling? The fact that our bodies have eyelids and lips. That they can sometimes close from the outside or be tightly locked from within.When we eventually return the weakest, softest, and most lonesome thing we possessour very lifeto the material world, no cost will be given to us in return.The mans story is told in the form of a letter to someone, telling his past. Through these letters, the reader learns about the love and pain he is carrying. He once loved a woman in Germany who had lost her hearing due to illness. At the time, he was gradually losing his sight, so he suggested using lip-reading as a means of communication. However, the woman could not accept this, and eventually, a violent incident occurred. Since they were unable to stay together, they went their separate ways, leaving the man with a deep and long-lasting wound.The woman is losing her ability to speak, and the man is losing the light in his life, yet they communicate with each other in their own ways. The woman does not speak aloud, but she handwrites on the mans palm with her finger or makes small gestures to signal her presence, letting him know she is here to listen. In response, the man assures that she is hearing him through her subtle reactions, gazes at her faintly visible figure in the darkness, and confesses his innermost thoughts. In the end, their connection is sustained by a new form of communication that transcends language itself. As the womans voice almost slips out once more, the novel comes to a quiet ending.This novel explores how human beings can understand and connect with each other even though words and light gradually fade away. It suggests that we do not form relationships through each others strengths, but rather through our most vulnerable parts. Even without sight or speech, communication is possible. By accepting and revealing each others fragility, true understanding and love can emerge. Ultimately, the novel shows that love can become a source of resilience and hope in life.「Human Acts」: Can the past help the present? Can the dead save the living?「Human Acts」 is a novel set against the background of the 1980 Gwangju Uprising, depicting the resistance of citizens against state violence and the long-lasting trauma that followed. The Gwangju Uprising was a democratic uprising led by the citizens of Gwangju and South Jeolla Province, demanding the abolition of martial law, the establishment of a democratic government, and the resignation of Chun Doo-hwan and the new military regime. In response, the military government deployed airborne troops, brutally suppressing both ordinary citizens and armed civilian militias, resulting in a tragic number of casualties and victims. This event left the people of Gwangju with an unforgettable trauma. The novel intertwines multiple perspectives, portraying the overwhelming violence of the time while ultimately exploring human dignity and the pursuit of light in the face of darkness.In the first chapter of the novel, Dong-ho, who witnesses the death of his friend Jeong-dae during the democratization movement, is addressed in the second-person pronoun you. This chapter portrays his inner turmoil as he helps collect the bodies of the deceased and ultimately follows him through his final choice. Dong-hos death serves as a connecting thread to the characters introduced in the following chapters, compelling them to reflect pain, guilt, and the meaning of survival. The next five chapters shift perspectives to different individuals who faced the violence in Gwangju, and the final chapter is told from the perspective of Dong-hos mother, who has lost her son.Since I could not hold a funeral for you after you died, my life itself has become a funeral.Yes, conscience. That is the most terrifying thing in the world. On the day I stood before the barrels of guns, pushing a cart loaded with the bodies of those the soldiers had shot dead, surrounded by hundreds of thousands of people, I was startled to suddenly discover something pure within myself.Han Kang has shared what inspired her to write this novel, recalling how, as a child, she found the photo book of the Gwangju Uprisings horrific scenes. The album contained images of bodies of the deceased and people standing in line to donate blood for the wounded. Confronting these images, Han Kang asked herself: How can humans be capable of such extreme violence while also standing opposite such overwhelming violence? She believed that to embrace a world where these dualities coexist, one must face the mystery of such contradictions. With this thought, she started on writing this novel.Many readers express that reading this novel is a painful experience. However, at the same time, it allows them to stand within an unforgettable moment of history and confront the truth. Through 「Human Acts」, Han Kang does more than simply record the emotions of individuals caught in a historical tragedy. She demonstrates that the very act of reflecting on what we can do as readers in the present, can serve as a bridge between memory and the present, showing that remembrance itself has the power to bring about change.Author Han Kang is a writer who has brought Korean literature to a global audience through her profound narratives and lyrical prose, exploring the human psyche, social violence, and the meaning of existence. Her works go beyond mere storytelling. They pose questions that linger, compelling readers to dwell on them and engage in profound contemplation. Han Kangs unique style often makes her novels resemble poetry, leaving lingering impressions with every turn of the page. In 「The Vegetarian」, she examines personal resistance and societal oppression. In 「Greek Lessons」, she explores the warmth of language and relationships. In 「Human Acts」, she confronts historical trauma, the weight of memory, and fundamental questions about human existence. Through these works, Han Kang continues to expand the boundaries of literature, inviting readers to reflect on the complexities of humanity.Literature is not simply an xss-object of analysis and interpretation. In Han Kangs works, each word is imbued with vivid sensations and emotions, allowing readers to experience and interpret them in their own ways according to their own perspectives and experiences. Literature is not just about following a plot. It is about emotionally engaging with characters and situations, reflecting on ones inner self, and through this process, awakening a new perspective of seeing the world. Han Kangs Nobel Prize in Literature invites more readers to engage with her works, reflect on the profound questions she raises, and discover new perspectives on life and society. Furthermore, this recognition is expected to draw greater attention to Korean literature, paving the way for its continued rise on the global literary stage.ReferencesHan Kang. The Vegetarian. Changbi Publishers, 2022.Han Kang. Greek Lessons. Munhakdongne, 2011.Han Kang. Human Acts. Changbi Publishers, 2014.Han Kang. "Nobel Prize Lecture." NobelPrize.org, Nobel Prize Outreach, 27 Feb. 2025, https://www.nobelprize.org/prizes/literature/2024/han/lecture/.Han Kang – Interview. NobelPrize.org. Nobel Prize Outreach 2025. Tue. 4 Mar 2025.The Korea Times. "Korean Novelist Han Kang Awarded Nobel Prize in Literature." The Korea Times, 10 Oct. 2024, https://www.koreatimes.co.kr/www/culture/2024/10/135_384030.html.
등록일2025-06-26 14:18:40