Comparative Financial Performance of Domestic and Foreign Construction Companies in Ethiopia
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Date
2009-06
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Addis Ababa University
Abstract
ABSTRACT
The paper entitled “Comparative Financial Performance of Domestic and Foreign
Construction Companies in Ethiopia” deals with measuring financial performance of
local and foreign contractors in Ethiopia.
The paper’s objective is to measure financial performance of each group and compare
to each other to identify the group which perform better comparatively and also to test
both group whether they are in financial distress.
The data used in the study is all secondary data obtained from Federal Inland Revenue
Authority from the financial statements reported by the contractors chosen for the
study.
A sample of eight companies five year financial statements are analyzed by using
financial ratios and a sample of five contractors’ financial statements are analyzed for
distress test. In order to substantiate the analysis regression and t-test were used.
The final study finding revealed that foreign contractors perform financially better
than local contractors. It is also found that local contractors are in financial distress
according to Altman’s cut-off
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Keywords
Construction companies in Ethiopia