Chapter 4: Financial Statement Analysis

In this section

• Introduction to Financial Statement Analysis
  Gain a comprehensive understanding of why and how to analyze financial statements, exploring frameworks, regulatory filings, and best practices that guide stakeholders in making informed decisions.
• Analyzing Income Statements
  Explore revenue recognition principles, expense matching, non-recurring items, EPS calculations, and key ratios in income statement analysis.
• Analyzing Balance Sheets
  A deep dive into balance sheet components, focusing on intangible assets, goodwill, financial instrument disclosures, non-current liabilities, common-size analysis, and key ratios.
• Analyzing Statements of Cash Flows I
  Discover how the statement of cash flows interlinks with balance sheets and income statements, the difference between direct and indirect methods, common pitfalls, and best practices to accurately measure a firm's liquidity and cash-generating ability.
• Analyzing Statements of Cash Flows II
  Explore advanced techniques for evaluating and interpreting statements of cash flows, including common-size analysis, free cash flow metrics, cash flow-based ratios, and the sustainability of cash flows.
• Analysis of Inventories
  Explore key inventory valuation methods (FIFO, LIFO, and average cost), understand how IFRS and US GAAP differ in inventory accounting, and learn how to analyze and interpret inventory on financial statements.
• Analysis of Long-Term Assets
  Explore the nuances of intangible assets (internally developed, purchased, or acquired), PP&E accounting models, and impairment considerations under IFRS and US GAAP. Dive into depreciation methods, key disclosures, and real-world examples to enhance your financial statement analysis skills.
• Topics in Long-Term Liabilities and Equity
  An in-depth exploration of lease accounting, pension plans, stock-based compensation, and related disclosures for long-term liabilities and equity, comparing IFRS and US GAAP perspectives.
• Analysis of Income Taxes
  Discover the key distinctions between accounting profit and taxable income, learn how deferred tax items arise, and explore critical tax rates and disclosures to master financial statement analysis of corporate taxes.
• Financial Reporting Quality
  Discover the essentials of high-quality financial reporting, explore common manipulation tactics, and learn how to spot warning signs in financial statements.
• Financial Analysis Techniques
  Master the core tools for effective financial analysis, including ratio analysis, DuPont decomposition, and benchmarking methods, to better interpret financial statements and assess company performance.
• Introduction to Financial Statement Modeling
  Learn how to build pro forma income statements and balance sheets, forecast operating assumptions, and factor in behavioral biases and industry forces for robust financial models.