Introduction to Financial Statement Analysis

Free CFA Level I lesson in Financial Statement Analysis. 14 min read, ~2,142 words.

Six steps: articulate purpose, collect, process, analyze, conclude, follow up. The first and last frame the work. Notes and MD&A often carry more decision-relevant information than the primary statements. Equity analysts focus on upside drivers; credit analysts focus on downside protection (interest coverage). The same statements serve both, but the...