In our last post, we described the big bath: when a bad period can't be disguised, management bundles every write-down and provision it can into that one period, then reports a cleaner future. A record loss alone doesn't prove this is happening. Sometimes the loss is
The Securities and Exchange Board of India (SEBI) and the National Financial Reporting Authority (NFRA) prohibit companies from going too far in prettifying their profits to pump up their share prices. These regulators refrain from indicating exactly how far is too far. For some withholding an information is not a
There are two distinct approaches to Financial Statement analysis. The first is to follow a prescribed routine, filling in boxes with standard financial ratios (precise and inflexible definitions), a cookie-cutter approach. The second and a more rewarding alternative is a relentless pursuit of accurate financial profiles. This tenacity is required
We are living in a rapidly changing financial environment. New business practices bring new concerns and challenges for people who rely on financial statements to understand how a company is performing. One important change took place during the late 1990s and early 2000s. Companies began changing the way they designed