The Art of Reading Financial Statements - Practitioner Level

Learn from a real value investor & independent board director, MBA, INSEAD IDP with PE & VC experience

4.66 (75 reviews)
Udemy
platform
English
language
Finance
category
instructor
706
students
16.5 hours
content
Jun 2023
last update
$94.99
regular price

What you will learn

Establish information source & download the latest financial report & identify accounting standard used IFRS, US GAAP or Local GAAP

Understand & identify main corporate governance elements : Determine corporate governance 1- or 2-tier model and external regulation

Understand role of statutory auditor, if audited identify statutory auditor, tenure of statutory auditor and audit opinion

Understand the scope of consolidation (& unconsolidation) of the company

Be able to do a vertical analysis of the balance sheet and understanding material assets & liabilities in balance sheet

Identify sources of capital including long-term debt, related schedule, cost to service long-term debt including interest coverage ratio, equity capital source

Deepen understanding of value creation for shareholders by understanding ROIC & WACC

Understand profitability of company by analysing revenue segments & cash generating assets, understand operating cash flow & working capital vs other cash flows

Be able to read earnings information including EPS, NOPAT, EBITDA, EBIT & net income

Description

Financial statements appear complex and long, their reading requires judgment and practice, people do not know where to start reading and what to look for or people read financial statements in a linear/sequential way without being able to grasp the main elements even red flags related to the company. This course intends to teach you the main reading keys to read, understand & digest financial statements & financial reports.

As Warren Buffett stated, if you want to become a better investor you have to understand the language of business which is accounting : “You have to understand accounting and you have to understand the nuances of accounting. It’s the language of business and it’s an imperfect language, but unless you are willing to put in the effort to learn accounting – how to read and interpret financial statements – you really shouldn’t select stocks yourself

I took the approach writing this course by looking back myself on what I was missing from my teachers & professors in my accounting & corporate finance classes. This course uses a different approach in reading financial statements and being able to quickly grasp the essence of the company being analysed.


After taking the course you will be able to :

  1. Identify & understand accounting standard used IFRS, US GAAP or Local GAAP

  2. Differentiate between 3 main types of financial statements (balance sheet, cash flow & income statement)

  3. Understand the fundamental accounting principles like going concern, fair valuation, principle of prudence, accrual vs cash accounting, etc.

  4. Understand & identify main corporate governance elements including corporate governance 1- or 2-tier models, role of shareholders & board of directors

  5. Understand role of statutory auditor, being able to identify if a report is audited or unaudited; if audited identify who the statutory auditor is, tenure of statutory auditor, comments about statutory auditor’s independence/conflict of interest / related fees and audit opinion

  6. Understand the scope of consolidation (& unconsolidation) of the reporting company and the 4 methods how subsidiaries can be (or not) consolidated into financial statements

  7. Be able to do a vertical analysis of the balance sheet and understand main profit generating assets and also the sourcers of capital in the balance sheet

  8. Identify sources of capital including long-term debt and its related schedule, cost to service long-term debt including interest coverage ratio, equity capital source including potential retained earnings

  9. Deepen understanding of value creation for shareholders by understanding ROIC & WACC

  10. Understand profitability of company by analysing revenue segments (if available) & cash generating assets, understand operating cash flow & working capital vs financing & investing cash flows

  11. Be able to read earnings information including EPS, NOPAT, EBITDA, EBIT & net income


The course also contains many practical examples as in all of my courses. We will practice & discussion financials of companies like Kelloggs, Mercedes, Telefonica, 3M, Evergrande, Alphabet, Meta, Microsoft, Unilever, Wells Fargo, Wirecard, CostCo and many more.

At the end of the training I will show you the complete process on how I read the financial statements for 3 companies (Vonovia, Qurate, Skywest Airlines) so that you can exactly see and hopefully replicate how I grasp the essence of companies that are not known to me at the beginning.

Last but not least, adult education without practice, knowledge checks and assignments is only entertainment. For that specific reason the course contains 10+ assignments to practice yourself as homework and share after completion with me for review if you wish.


Wishing you a lot of success taking this training and hoping it will make you grow as an investor, analyst or corporate professional. Thanking you as well again for selecting my course

With thanks

Candi

Content

Introduction

Introduction
History & purpose
Reporting standards
Financial statement types
Reporting & accounting principles
Knowledge check

Main elements of Corporate Governance

Corporate law & company consolidation
Shareholders
Board of Directors
Auditors
Knowledge check

Inventory of company resources & capital

Balance sheet structure & value creation cycle
Vertical & horizontal analysis - How to capture essence of balance sheet
Primary sources of capital - equity
Secondary source of capital – Introduction to debt & financial debt
Other types of debt & liabilities
Introduction to assets in balance sheet
Main current assets in balance sheet
Main non-current / long-term assets in balance sheet
Knowledge check

Understanding value creation & profitability

Revenues & net income
Net income & cash flows
Realized vs unrealized earnings
Value creation & ROIC
Knowledge check

Conclusion

Example 1 : Analysis of Vonovia
Example 2 : Analysis of Qurate
Example 3 : Analysis of Skywest Airlines
Final thoughts

Screenshots

The Art of Reading Financial Statements - Practitioner Level - Screenshot_01The Art of Reading Financial Statements - Practitioner Level - Screenshot_02The Art of Reading Financial Statements - Practitioner Level - Screenshot_03The Art of Reading Financial Statements - Practitioner Level - Screenshot_04

Reviews

Larry
September 5, 2023
I found the course very informative. I have no accounting/finance background, other than college accounting classes (very long ago). Candi's guidance through the different parts of a financial report will help me in the future, I'm sure!
Patrick
July 24, 2023
Candi opens the course by explaining how the linear teaching model is expired and how he wishes that this course was available to him when he was 25. I have comfortably worked my way through several startups and I've had a wonderfully colourful and successful career. I'm 40, not 25, and I only wish I had discovered this course earlier. Through every company I'd always been restricted by a glass ceiling. One that created a gulf between my accountants and myself. This course invaluable and is massively underpriced. If you have a business, if you're moving up through management, you can't afford to not-know everything Candi teaches. It will make you look at everything you're doing with fresh eyes. It will compel you to set financial goals better than ever and you'll be able to question your accountants and ask them why they're not encouraging you to manage every part of your financial statements in a way that sets you up for success. This course is the perfect first step if you don't have the time to stop work for an executive degree. From here you can taste what you didn't know you didn't know and you can explore further. I can't recommend this enough.
Kathleen
May 11, 2023
Yes - very good match - I really appreciate the time Candi puts into his courses so they provide practical advice on how to actually implement what we are learning - too many courses focus exclusively on theory and provide very little instruction and practical examples on how to actually use the what we are learning to value real companies for investment purposes
Adriano
March 23, 2023
Like always, amazing structured lecture provided by Candi. A lot of information, well explained. I appreciate a lot the way Candi explain all the important topics and will never thank Candi enough for the time he invests into his trainings!!!
Ioannis
March 17, 2023
Engaging, straight to the point and practical. No waste of precious time and deep insight of key topics

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Related Topics

5036910
udemy ID
12/22/2022
course created date
4/5/2023
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