The Analysis and Use of Financial Statements [Hardcover]

Gerald I. White (Author), Ashwinpaul C. Sondhi (Author), Haim D. Fried (Author)

Book Description

ISBN-10: 0471111864 | ISBN-13: 978-0471111863 | Publication Date: June 23, 1997 | Edition: 2

This guide to interpreting financial statements is written from the point of view of financial statement users. It will enable you to make better business and personal investment decisions by understanding how accounting choices affect financial data and how you can adjust reported data to enhance decision making. The book includes comparisons of US with foreign and international accounting standards as well as implications of academic research for financial analysis and decision making. You'll also find discussion and analysis of such timely issues as market value accounting and off-balance-sheet financing techniques. This updated edition emphasizes coverage of international financial reporting.

Editorial Reviews

Review

Instructor's Manual available. -- The publisher, John Wiley & Sons --This text refers to an out of print or unavailable edition of this title.

From the Publisher

This guide to interpreting financial statements is written from the point of view of financial statement users. It will enable you to make better business and personal investment decisions by understanding how accounting choices affect financial data and how you can adjust reported data to enhance decision making. The book includes comparisons of US with foreign and international accounting standards as well as implications of academic research for financial analysis and decision making. You'll also find discussion and analysis of such timely issues as market value accounting and off-balance-sheet financing techniques. This updated edition emphasizes coverage of international financial reporting.

See all Editorial Reviews

Product Details

• Hardcover: 1248 pages
• Publisher: Wiley; 2 edition (June 23, 1997)
• Language: English
• ISBN-10: 0471111864
• ISBN-13: 978-0471111863
• Product Dimensions: 10.4 x 8.1 x 2.1 inches
• Shipping Weight: 5.2 pounds
• Average Customer Review: 3.4 out of 5 stars  See all reviews (25 customer reviews)
• Amazon Best Sellers Rank: #1,276,682 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

62 of 69 people found the following review helpful:

5.0 out of 5 stars Comprehensive and Insightful, January 28, 2001

By 

Netman1 (Between Here and There) - See all my reviews

This review is from: The Analysis and Use of Financial Statements (Hardcover)

In order to determine whether you should buy this book, you have to understand its purpose.

It is not an Accounting textbook nor a preparation for the CPA exam.

In other words, it is not directed at the preparers of financial statements but rather at the users.

The authors do an excellent job of explaining accounting concepts in a clear and detailed manner. That explanation includes a comparison of different methods for accounting for the same transaction, a discussion of deficiencies/inconsistencies in accounting rules, etc.

Building on all this, the authors then move on to explain how to analyze financial statements - to wring insights out of the accounting data beyond the "standard" analytical tools. This is the book's real value.

This excellent book belongs in the reference library of anyone who needs to understand and analyze financial statements.

One measure of its value is that AIMR uses it as one of the fundamental textbooks for its CFA program.

38 of 44 people found the following review helpful:

5.0 out of 5 stars This Book Is Excellent...and Essential, April 8, 2002

By A Customer

This review is from: The Analysis and Use of Financial Statements (Hardcover)

After reading the reviews on this book, I feel that I must comment on the book's high quality.

In order to fully appreciate this book, an understanding must exist as to where the material fits in the financial analysis process. Clearly this book is not meant to explicitly teach readers how to build financial models; other books are available for that purpose. This book is designed to teach readers how to thoroughly read, understand, and more importantly, become an astute critic of the language of financial statements, GAAP.

I disagree that technical accounting details are not very important in analysis engagements. Rather the opposite holds true in a majority of cases: One must thoroughly understand technical accounting and the implications that it has on economic reality in order to build quality financial models. Otherwise, "junk in/junk out" models will result.

Given the highly publicized debacles that have recently occurred in the financial world, including Enron, the importance of distinguishing technical accounting from economic reality has become obvious. This book does effectively explain and build off the foundations of GAAP; however, this book is primarily focused on helping an analyst analyze and question the quality of financial statements versus how to simply prepare them. This is the big difference between this book and technical accounting textbooks.

Of course, building financial models for decisions is the end objective of any analyst. However, this book is a must read in building quality financial models and projections. Again this book is not a financial modeling textbook, nor a technical accounting manual. Rather, it is a critical bridge between technical accounting material and decision modeling material. I recommend taking the time to read this excellent book and walk across the bridge before moving on to modeling.

31 of 39 people found the following review helpful:

5.0 out of 5 stars Simply the Best!!!, June 12, 1998

By 

Antonio Vicente La Camera - See all my reviews

This review is from: The Analysis and Use of Financial Statements (Hardcover)

The authors were very successful in providing a complete coverage of every single aspect on financial statements analysis. It's the kind of book to be used on a daily basis, either as a refresher on accounting concepts or as a reference when developing sound financial analyses.

One suggestion: the authors should provide a solutions manual to accompany the book. It has many exercises and cases to be dealt with and therefore it would be interesting for the student to compare her own solution with that provided by the authors.