Investing Book Review – “International Financial Statements Analysis”

Investing Book Review – “International Financial Statements Analysis” by
Thomas R. Robinson, CFA, Hennie van Greuning, CFA, Elaine Henry, CFA, Michael A. Broihahn, CFA

This week I managed to finish reading another monster book in finance – “International Financial Statements Analysis” which is specifically targeted for the CFA (Chartered Financial Analysts) students and professionals. To be honest, I was impressed when I first looked at this book – it looked very dense, and packed with various topics which had a vague resemblance with some of my studies I had in the past. At least on the surface… So at first I was very curious – what did it contain?

“International Financial Statements Analysis” is one of the few investment books that delivers exactly what is written on the cover. This is actually a handbook on how to analyze to the last level of detail the financial statements, based on the IFRS (International Financial Reporting Standards) principles. In other words, this is both a financial analysis book and a tome on the International Accounting Standards (IAS) – one could even say that in substance this book is an IFRS manual reverse engineered. No wonder that Sir David Tweedie endorsed it upfront – this is a great tool which anticipates the longed for projects of converging the US and the UK accounting standards.
Even “International Financial Statements Analysis”’s summary reflects the IFRS structure. Just for your broad idea, here’s the book’s summary listed shortly:

Foreword xvii
Preface xix
Acknowledgments xxiii
Introduction xxv
CHAPTER 1 Financial Statement Analysis: An Introduction 1
CHAPTER 2 Financial Reporting Mechanics 25
CHAPTER 4 Understanding the Income Statement 113
CHAPTER 5 Understanding the Balance Sheet 165
CHAPTER 6 Understanding the Cash Flow Statement 215
CHAPTER 7 Financial Analysis Techniques 259
CHAPTER 8 International Standards Convergence 323
CHAPTER 9 Financial Statement Analysis: Applications 349
CHAPTER 10 Inventories 389
CHAPTER 11 Long-Lived Assets 419
CHAPTER 12 Income Taxes 469
CHAPTER 13 Long-Term Liabilities and Leases 505
CHAPTER 14 Employee Compensation: Postretirement and Share-Based 555
CHAPTER 15 Intercorporate Investments 605
CHAPTER 16 Multinational Operations 657
CHAPTER 17 Evaluating Financial Reporting Quality 723
For those wishing to drill through various analytical techniques involving lots of advanced mathematics, “International Financial Statements Analysis” might not be appropriate. But for the ones who are trying to grasp the complexity of getting together comprehensive financial reporting standards, this book is impressive. As an ACCA (Association of Chartered Certified Accountants) member, I can only appreciate how nice this handbook can be for a CFA professional who wants to drill through the world of finance quickly and efficiently. In a sense, “International Financial Statements Analysis” is the ultimate reference manual for drilling through the practicalities of the IFRS – and does a nice job here.

Once again, nice job from the Wiley Professional Publishing House, who made this book accessible for the finance-hungry masses. Keep going!

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