Reading Financial Reports For Dummies^?

by Lita Epstein

• ISBN13: 9780764577338
• ISBN10: 0764577336
• Format: Paperback
• Copyright: 2004-12-01
• Publisher: For Dummies

Summary

The U.S. government began standardizing and regulating financial reporting in 1929 when the stock market crash made it painfully clear that businesses often made absurd claims and that investors were either gullible, unable to verify information, or both. Now, financial reports are used by a company's management to measure profitability (or lack of it), optimize operations and guide the company, by banks and other lenders to gauge the company's financial health, and by institutional or individual investors interested in purchasing stock.Unless you're financially savvy, annual reports with all those figures, frustrating footnotes, and fine print are boring and intimidating. However, once you have a fundamental knowledge of finance and its basic terminology, you can find the juicy parts. Reading Financial Reports For Dummies by Lita Epstein, a teacher of online financial courses and author of Trading for Dummies, gets you up to speed so you can: Go past the prose that can maximize the positive and minimize the negative and get information in dollars and cents Get an overview from the big threethe balance sheet, income statement, and statement of cash flows Understand the lingo and read between the lines Calculate basics like PE, Dividend Payout Ratio, ROS, ROA, ROE, Operating Margin, and Net MarginIt pays for investors to be somewhat skeptical instead of gullible. Pressured to please Wall Street, companies are sometimes tempted to use "creative" accounting. You'll discover how to: Detect red flags (that, unfortunately, aren't emphasized in red) such as lawsuits, changes in accounting methods, and obligations to retirees and future retirees Understand the different reporting requirements for public companies and private companies with various types of business structures Analyze a company's cash flow, a prime indicator of its financial health Scrutinize deals such as mergers, acquisitions, liquidations and other major changes in key assetsOrganized so you can start where you're comfortable and proceed at your own pace, Reading Financial Reports for Dummies helps managers prepare annual reports and use financial reporting to budget more efficiently and helps investors base their decisions on knowledge instead of hype. Whether you're in business or in the stock market, knowledge is always an asset.

Author Biography

Lita Epstein is a writer and a designer and teacher of online financial courses, as well as the coauthor of Trading For Dummies.

Table of Contents

Introduction.

Part I: Getting Down to Financial Reporting Basics.

Chapter 1: Opening the Cornucopia of Reports.

Chapter 2: Recognizing Different Business Types.

Chapter 3: How Company Structure Affects the Books.

Chapter 4: Digging Into Accounting Basics.

Part II: Checking Out the Big Show: Annual Reports.

Chapter 5: Exploring the Anatomy of an Annual Report.

Chapter 6: Balancing Assets against Liabilities and Equity.

Chapter 7: Using the Income Statement.

Chapter 8: The Statement of Cash Flows.

Chapter 9: Scouring the Notes to the Financial Statements.

Chapter 10: Considering Consolidated Financial Statements.

Part III: Analyzing the Numbers.

Chapter 11: Testing the Profits and Market Value.

Chapter 12: Looking at Liquidity.

Chapter 13: Making Sure the Company Has Cash to Carry On.

Part IV: Understanding How Companies Optimize Operations.

Chapter 14: Using Basic Budgeting.

Chapter 15: Turning Up Clues in Turnover and Assets.

Chapter 16: Examining Cash Inflow and Outflow.

Chapter 17: How Companies Keep the Cash Flowing.

Part V: The Many Ways Companies Answer to Others.

Chapter 18: Finding Out How Companies Find Errors: The Auditing Process.

Chapter 19: Digging Into Government Regulations.

Chapter 20: Checking Out the Analyst-Corporation Connection.

Chapter 21: How Companies Soothe the Shareholders.

Chapter 22: Keeping Score When Companies Play Games with Numbers.

Part VI: The Part of Tens.

Chapter 23: Ten Financial Scandals That Rocked the World.

Chapter 24: Ten Signs That a Company’s in Trouble.

Chapter 25: Ten Top-Notch Online Resources.

Part VII: Appendixes.

Appendix A: Financial Statements.

Appendix B: Glossary.

Index.