Following the systematic acquisition of theoretical knowledge and skills, students are expected to apply this acquired knowledge, i.e. to know how to apply it in concrete, real situations. This paper was written with this in mind. Due to strong competition and daily business challenges, businesses need to constantly analyse their past in order to define their future plans and direction. The most important part of the overall business analysis of a business entity is the analysis of financial statements. It is a collection of different analytical tools and techniques that are used to convert financial statements into usable information that is later used to make business decisions. The ultimate goal or aspiration in an activity undertaken by a legal entity is to make it as successful and profitable as possible. But the question is: what does a safe and successful business entail? Which criteria is used as a basis for evaluation or assessment of such a business? What are the key indicators of safe and successful business operations of a company? How relevant and credible are these indicators in general? Determining business success is important at all times because today's globalized and highly competitive business environment, the management and governance structures of each business entity must possess timely and continuous information, not only regarding their business performance and trends but also the performance of their direct competitors, as well as the sector in which they operate, in order to timely anticipate unfavourable or undesirable trends or results. This paper contains an analysis of the financial statements of the “Sveti Nikola” Nursing Home. It is an institution located in the centre of the peaceful and serene city of Krapina, the historical and cultural centre of the Krapina-Zagorje County. The institution has been operating since 2003, and the staff of the home, under a common mission, provide security, care and support for the elderly and infirm. The vision of the Home is to become the leading home in the region and recognized and acknowledged in the Republic of Croatia. The main activity of the Home is the provision of housing, food, personal hygiene assistance, health care, work activities and quality leisure time for the elderly and infirm. The home is privately owned and its business operations consist of social care and accommodation for the elderly and people with disabilities.