SFoyil

This is what i think. Given the 3 choices, ROA = NI/Avg. Total Assets. So by reducing asset (denominator) you would improve the ROA. Total Asset T/O = Rev/Avg Total Asset. The same logic applies. Finally, Financial leverage = avg. Total Asset/Avg Total Equity, by reducing assets (numerator) you would be making it worse and that is why management would LEAST likely understate it to improve.