Horizontal analysis
In one sentenceComparing each item in the financial statements with its value in a previous year, in SAR and as a percentage, to see what rose, what fell and how fast.
Simply put
You put the two years side by side, and for each item you calculate the difference in SAR and then divide it by the previous year's value. This way you see which items grew faster than sales and which declined.
The most important things it reveals: an expense growing faster than revenue, or receivables growing faster than sales; both deserve asking why.
Worked example
A household goods store sold 1,000,000 SAR in 2025 and 1,200,000 SAR in 2026, and its administrative expenses rose from 150,000 to 210,000 SAR.
Change in sales = 1,200,000 − 1,000,000200,000 SAR
Sales growth rate = 200,000 ÷ 1,000,00020%
Change in administrative expenses = 210,000 − 150,00060,000 SAR
Growth in administrative expenses = 60,000 ÷ 150,000 (faster than sales)40%
Formula: (Current year value − previous year value) ÷ previous year value
Don't confuse it with
Vertical analysisHorizontal analysis compares an item with itself over the years, and vertical analysis compares items with each other in the same year.
in FullScreen ERP
Unlimited fiscal years let you compare performance between years. General accounts