The Financial Times Guide to Using and Interpreting Company Accounts

Book excerpt: The Financial Times Guide to Using and Interpreting Company Accounts is designed for the non-accountant manager, investor or entrepreneur who is expected to have financial knowledge but may not have accounting training. Wendy McKenzie approaches the project via three key points: What information will I find in these accounts?; How do I analyse the accounts?; How can I use my analysis? Using publicly available actual accounts, the book begins by covering the ‘numbers’ from company accounts then moves on to information such as the financial review and then explains the logic of the accounts. To help with the interpreting of the numbers Wendy shows the reader how to understand issues such as cash flow, what this will tell you about a company, how to consider a competitor’s accounts and how to perform ratio calculations to help with company analysis.