Practical analysis for investment professionals

Financial Statement Analysis


Book Review: How to Make Money with Junk Bonds

This well-written and occasionally humorous tutorial on investing in speculative-grade corporate debt covers the essential aspects of high-yield debt, including credit analysis and why one would want to invest in high-yield bonds in the first place. As a basic introduction to the high-yield debt market, the book can’t be beat.

Book Review: Financial Statement Analysis: A Practitioner’s Guide

This entertaining book persuasively argues that it is both naive and dangerous for practitioners to accept financial reports at face value. Using both real-world examples and hypothetical scenarios, the authors demonstrate that in the “real world,” financial statements often conceal as much as they reveal.

Lie Detection for Investment Professionals: A Summary of Lying and Deceit Behaviors

Jason Voss, CFA, provides a summary of the major research about lying and deceit behaviors, including a brief overview of dozens of research papers.

Book Review: A Pragmatist’s Guide to Leveraged Finance

This treatise on security-specific analysis of speculative-grade debt by a seasoned, highly regarded specialist in the field is the best book yet on the subject. Covering all aspects of risk assessment and valuation of speculative-grade bonds and leveraged loans, it is essential reading for all professionals engaged in such analysis.

The Post Ratings Agency World: An Interview with Invictus Group’s Kamal Mustafa

A powerful alternative to traditional credit ratings is the scenario-planning approach developed by Kamal Mustafa, CEO of Invictus Consulting Group.

Book Reviews: Swindlers

Effective 1 January 2011, the International Financial Reporting Standards (IFRS) became mandatory for Canadian public companies. Proponents of IFRS adoption argued that it would enhance global comparability of financial statements. The authors of Swindlers: Cons & Cheats and How to Protect Your Investments from Them argue, on the contrary, that “differences in laws, regulations, taxes, cultures, education, ethics, training, traditions, enforcement, and optimism make uniformity an opium dream.”

History Repeating Itself: Groupon’s Questionable Accounting Practices Are Nothing New

A few months ago, I wrote about how Groupon had been using a non-GAAP accounting metric, “adjusted consolidated segment operating income” (CSOI), to explain its past performance — a practice the online… READ MORE ›

Take 15: How Are Asian Financial Institutions Impacted by Changing Accounting and Regulatory Regimes?

Yin Toa Lee, CFA, reviews the new global regulatory initiatives and changing accounting standards and their business impacts on Asian financial institutions. He discusses what board, management, and audit committees should be doing today to prepare for such significant changes, including issuing communications to the investor and analyst communities.

The Bizarro World of FAS 159

Do you remember the episode of Seinfeld titled “The Bizarro Jerry”? In this episode, which was based on Bizarro Superman, everything is backwards, i.e., up is down, down is up, in is out, out is in.

Well, financial institutions have… READ MORE ›

Is It Déjà Vu All Over Again?

The Wall Street Journal has published a number of articles about Groupon, the ecommerce internet company that is planning to go public. A July 28th article focused on Groupon’s use of a… READ MORE ›



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