Financial Statement Analysis and Security Valuation

This text focuses on the output of financial statements, not the input. As such, this book asks what financial statements tell you, not how they are prepared. The idea is to get students to see accounting "working". The particular use of financial statements that this book focuses on is valuation. This text takes the approach that the best way to accurately value a firm is to look at the future earnings of the firm. The main pretext of this book is that financial statement analysis and valuation analysis are inextricably entwined. Valuation is an exercise in financial statement analysis. Financial statement analysis is directed by the need to get information for valuation. Accordingly, this book brings finance and accounting concepts together. This book stresses concepts, but the idea is to show how to move from concepts to practice.