The Story Underlying the Numbers: A Simple Approach to Comprehensive Financial Statements Analysis

When faced with financial statements of a firm, very often students and even practitioners are seen to be at a loss where to begin with analysis. Most simply compute every ratio they know and interpret them in a standalone manner. They are unable to thread them together to spin a meaningful story that can completely or at least substantially explain what might be happening at the firm. Decision making of any kind based on such a piecemeal approach will remain flawed. This book uses a logical, top-down approach to unraveling the underlying story of the firm. It can be used by students and working executives who have a rudimentary prior idea of financial statements as well as familiarity with the very basic financial ratios. It is a myth that only executives in the finance function need to understand financial statements. Every decision within a firm has implications for the financial statements, and the need for such knowledge increases as one goes up the corporate ladder. The book is intended to be free flowing, with minimum jargon so as to be understood and appreciated especially by non-finance executives and students of business and management.

About the Author

S. Veena Iyer is Assistant Professor with Management Development Institute, Gurugram, India in the area of Accounting and Finance. She teaches Financial Accounting, electives on Business Valuation and Management of Financial Services to MBA and Executive MBA students. She regularly undertakes training sessions for industry executives on understanding and analyzing financial statements. She trains bank executives on understanding financial statements of borrowers as well as of their banks with a view to understand how credit risk can be assessed and will impact bank profitability. She has published teaching cases that are listed on the Harvard Business School Publishing repository. Prof. Iyer has worked in industry as a practice lead in the business research and consulting space where she has led teams of analysts on client projects.