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Trend analysis

Trend analysis compares financial amounts or ratios over successive periods to identify changes. Calculate percentage change as the change divided by the earlier period's amount, multiplied by 100. Use consistent definitions and comparable accounting periods, then explain what changed and investigate why. Consider whether unusual events or changes in business scale affect the comparison. A negative or zero base requires care because a simple percentage change can mislead or be undefined.

Worked example

Revenue rising from 100 to 120 to 144 grows 20% each year.

Common mistake

Changes in accounting policy, inflation, acquisitions and seasonality can make raw comparisons misleading.

Where it appears in your exams

QualificationExamRelationshipPeriod
ACCA F3 Direct July 2027–August 2028
ACCA FA Supporting September 2026–June 2027
ACCA K1 Supporting July 2027–August 2028
CIMA F2 Direct Official assessment-window verification pending
FIA FFA Supporting September 2026–June 2027

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