Analysis of financial reports is used to judge s business, it deals with analytical testing of financial abilility of a company, wich are used to make business plans and decisions of the company. Goal of this paper is to analyze the success of tho company Kandit d.o.o. from 2016. to 2019., through annual financial reports. In this paper are the financial reports of the company Kandit., during the period from 2016. to 2019., analyzed. The balance sheet and the account of the gain and loss are through the vertical and horizontal analasys analyzed. The paper contains five parts. The first and second part refers to the introduction and methodology, where the short introduction into the topic of the work described is. The third oart shows informations about the company Kandit, their management and history. In the fourth part are the financial reports of the company Kandit processed. In this part are the vertical ant horizontal analysis of the balance sheet and the account of the gain and loss, as well as the cash flow processed. The fifth part of the work shows the analysis of the financial ratio. For the analysis are the ratio of the liquidity, indebtedness, activity, economy and profitability chosen. Through the horizontal and vertical analasys of the balance sheet, we can come to the conclusion that the value of fixed assets is decreasing through the observed period. The analasys of the liquidity is shoeing us that the company is no table to settle the short-term liabilities from the current assets. Though it does not necessary imply that the company is not liquid. The indebtedness ratio shows us that the company finances most of its assets from extraneous sources. By looking into the economical management and economy of total business we can see that the business has run economical during the observed period. The cost-effectiveness of financing, of the observed example, shows us that the economy of the company, regarding the cost-effectiveness indicator of the financial management, is negative, meaning that the company can not cover the financial expense, because it achieves lesser financial incomes.