Reading Financial Reports For Dummies

Features

• Cover Type: Paperback with 384 pages
• Published by: For Dummies December 24, 2004
• Written in: English
• ISBN 10 Number: 0764577336
• ISBN 13 Number: 978-0764577338
• Book Dimensions: 9.1 x 7.4 x 1.1 inches
• Weighs: 1.3 pounds

Product Description
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 ridiculous 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 three—the 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 Margin

It 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 assets

Organized 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.

Back Cover Copy
Simple strategies for measuring a company's financial health

Decipher the jargon and read financial reports like a pro

Whether you're a serious investor or hold a few shares in the company you work for, reading financial reports is a vital way to keep tabs on a company's performance. This clear and friendly guide will help you wade through the numbers to see what's really going on - so you can make smarter and more profitable investment choices.

Discover how to:

• Make sense of balance sheets
• Find the figures that tell the tale
• Test the numbers with simple formulas
• Recognize red flags in the footnotes
• Understand deceptive accounting practices

Reader Reviews
I recently had to take a week long seminar about financial statements and didn't want to go in cold turkey and possibly embarass myself ... so I bought three books thru Amazon to help me learn about financial statements, this one being the most comprehensive. I'll make this short and sweet ... this was an excellent book by any standard ... the other two books were brief and excellent overviews, but I'd have to judge Lita's (author) book as superb. It was as if I learned detail from a text book (factual substance), but then had her sitting beside me saying ... ok, you know such and such, now this is how it really works, or this is how you apply it, or this is what it means, or this is what you need to do next, or these are the tricks of the trade only insiders know, etc. Plus her ten real world discussions of what went wrong with certain corporations ... Enron, WorldCom/MCI, Tyco, etc., are very interesting reads. For instance, she tells you how to go about listening to a call between analysts and corporate executives, which honestly I did not know you could do. It's this added perspective of an experienced insider's knowledge of the business that puts her above the rest ... and this being a 362 page book, which I read cover to cover, there are plenty of these types of examples. For anyone who is not well versed in this subject matter, but WANTS to learn about it, quit pondering the purchase and just buy the book. It is money well spent ... I guarantee it. Oh, and by the way, Lita dedicates the book to her father, who was an auditor and savings and loan examiner ... so you know she was taught plenty by ole Dad ... this stuff was in her blood from the get go, and she communicates her extensive knowledge very well. I sincerely congratulate her on such a fine work. I enjoyed it immensely! Thank you Lita ... Jim