It Pays to Read the Boring Stuff: What the Ordinary Investor Needs to Know About Corporate Financial Information

Corporate financial statements, and the Management Discussion & Analysis statements that accompany them, are among the most boring documents in the world. Yet they also contain information that is of vital importance to the individual investor. This book teaches you how to read these statements and extract this information. Many once popular companies, such as JDS Uniphase, Nortel, Air Canada and Bombardier were sending out warning signals of their impending doom in their financial statements as much as two or three years before their collapse. Investors who knew where to look could have avoided disaster by selling before the price collapse, or, better yet, not buying at all.

This book focuses on Canadian companies and uses Canadian accounting rules and statements, but the concepts discussed are relevant to the U.S. scene as well. While it may not help you avoid cases of outright fraud, such as Enron, it should help you to find the warnings of potential disaster that are often hidden in plain sight in the publicly available financial information put out by all publicly traded companies.