How to Read a Financial Report: Wringing Vital Signs Out of the Numbers [Paperback]

John A. Tracy CPA (Author)

Book Description

Publication Date: May 4, 2009 | ISBN-10: 0470405309 | ISBN-13: 978-0470405307 | Edition: 7

How to Read a Financial Report Seventh Edition

Financial reports provide vital information to investors, lenders, and managers. Yet, the financial statements in a financial report seem to be written in a foreign language that only accountants can understand. This Seventh Edition of How to Read a Financial Report breaks through the language barrier, clears away the fog, and offers a plain-English user's guide to financial reports. The book helps you get a sure-handed grip on the profit, cash flow, and financial condition of any business.

Here's what's new in the Seventh Edition:

• Discussion of the transition to international accounting and financial reporting standards

• A streamlined centerpiece exhibit used throughout the book to explain connections between the three financial statements

• An integrated section on analyzing profit, cash flow, and solvency for investors, lenders, and managers (now Part Two in this edition)

• Reflection on financial reporting and auditing in the post-Enron era

"What distinguishes Tracy's efforts from other manuals is an innovative structure that visually ties together elements of the balance sheet and income statement by tracing where and how a line item in one affects an entry in another."
—Inc.

"An excellent job of showing how to separate the wheat from the chaff without choking in the process."
—The Miami Herald

"A wonderful book organized logically and written clearly. For a Fool to be an effective investor, she has to know her way around a financial statement. This book will help you develop that skill. It's the clearest presentation of many accounting concepts that this Fool has seen."
—Selena Maranjian, The Motley Fool

Editorial Reviews

About the Author

JOHN A. TRACY is an award-winning Professor of Accounting, Emeritus, at the University of Colorado at Boulder. His other books include The Fast Forward MBA in Finance, Second Edition, Accounting For Dummies, Fourth Edition, and Accounting Workbook For Dummies, all published by Wiley.

Product Details

• Paperback: 216 pages
• Publisher: Wiley; 7 edition (May 4, 2009)
• Language: English
• ISBN-10: 0470405309
• ISBN-13: 978-0470405307
• Product Dimensions: 9.8 x 0.6 x 6.7 inches
• Shipping Weight: 12 ounces (View shipping rates and policies)
• Average Customer Review: 4.5 out of 5 stars  See all reviews (50 customer reviews)
• Amazon Best Sellers Rank: #33,332 in Books (See Top 100 in Books)

Most Helpful Customer Reviews

97 of 99 people found the following review helpful

5.0 out of 5 stars Well Written Overview of Financial Statements and Accounting December 12, 2000

By tim747

Format:Paperback

This book is great for anyone ranging from beginner to intermediate knowledge of financial reports. I have taken accounting and finance classes in college. This book tells the same things that 600 page textbooks and hours and hours of lecture can tell you, but it does so in an easy to understand and concise manner.

Most important it explains the relationships clearly between the income statement, balance sheet, and cashflow statement. This book would be great for anyone starting an education in finance or for any investor trying to broaden their knowledge base. If you invest in stocks, you should learn how to read financial statements. This book will give you some much needed knowledge that you can use as you scour for companies to invest in.

This author takes pride in his writing. John A. Tracy is a professor of accounting, but his knack for concise explanations and the clear use of the English language is evident throughout.

91 of 95 people found the following review helpful

4.0 out of 5 stars GREAT BOOK BUT SOME PRIOR KNOWLEDGE WILL BE A PLUS! July 11, 2001

By Sandra D. Peters

Format:Paperback

As a teacher of business management, I have found the one component of training that often frustrates most students is understanding and preparing a cash flow statement, profit and loss statement and a balance sheet. This book is written in a manner which certainly simplifies the understanding of the statements, but it would definitely be a plus if the reader had some prior knowledge of basic accounting principles.

Financial statements are, for some, a challenge and one they can easily master with an understanding of basic accounting. For others with no prior knowledge of accounting, financial statements can be a nightmare. While this book will HELP TO SIMPLIFY the matter, without some previous experience the book may be quite confusing. First of all, one should at least be familiar with general accounting terminology. If you are, it will simplify this book enormously and make the learning experience more enjoyable. However, be prepared to sit down and devote your utmost concentration to the book. The subject matter is not one that can be mastered by skimming through the book in an evening or two. For many individuals, understanding financial statements is a course that takes months to completely understand. Some learn the process easily, others never master the challenge no matter how long or hard they try. The degree of success usually depends, in part, on apptitude, commitment and previous knowledge and experience of the reader.

61 of 62 people found the following review helpful

5.0 out of 5 stars One of the most useful presentations of this topic ever. July 11, 1999

By A Customer

Format:Paperback

I have used this book to teach people with absolutely no training in accounting to understand financial statements. It appeals to non-quantitative and quantitative audiences alike. Non-quantitative audiences appreciate the plain language in which the book is written. Quantitative audiences immediately see how financial statements are laid out from a modelling point of view and invariably start coding up spreadsheets. People who need to explain anything related to financial statements should thoroughly read this book to see how clearly this topic can be treated.

Another aspect of this book is the ratio of success-to-effort one gets out of reading this book. Professsor Tracy's experience and time spent thinking about this topic is clearly demonstrated by his ability to explain just enough to allow even the rank beginner to understand financial statements.