Practical Oriented Analysis of Financial Statements

Explore the balance sheet and P&L statement, their differences, what they reveal about assets, liabilities, revenue, and net profit, with a practical business example.

Explore the cash flow statement's importance and structure, including operating, investing, and financing activities, illustrated by a practical month-by-month example showing cash versus profit.

Understand how depreciation allocates asset cost over its useful life, impacting profit and loss and balance sheet through straight-line and double-declining methods, and the choice between capex and opex.

Explore how inventory flows from raw materials to finished goods and converts into COGS on the P&L, including COGM, balance sheet implications, and obsolescence risks.

Connect working capital to the cash conversion cycle by detailing days payable outstanding, inventory period, and days of sales outstanding, and compare a traditional model with an online retailer.

Map the flow of sales and expenses across the balance sheet, profit and loss, and cash flow statements, showing receivables, payables, inventory, cogs, and depreciation.

Explore why financial health goes beyond ratios by examining paradoxes in assets and liabilities, such as inventory, float, R&D, and goodwill, and the dynamics between on-book health and real performance.