Interesting read 24 Aug 2013 – Quality of Earnings, 10 point checklist by Alfred Rappaport

1. Revealing the truth about Quality of Earnings –
Understanding accounting gimmicks is very important in analysing any company’s financial reports. Given here are a few like how companies keep increasing credit sales, operating profit vs net profit, capital vs operating leases, changes in depreciation methods etc., Though most of these are valid from an audit point of view, these hide vital statistics which will require further analysis

2. Ten Ways to Create Shareholder Value –
Alfred Rappaport has written an excellent article in HBR, highlighting 10 key points that investors should check while analysing a company. A very useful read.

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