Accounting Statements and Cash Flow参考.ppt

Chapter Outline 2.1 The Balance Sheet 2.2 The Income Statement 2.3 Net Working Capital 2.4 Financial Cash Flow 2.5 Summary and Conclusions Sources of Information Annual reports Wall Street Journal Internet 上海证券交易所： /sseportal/ps/zhs/home.html 深圳证券交易所 长城证券：高速行情/index.jsp NYSE () Nasdaq () Text (/cj) SEC EDGAR 10K 10Q reports 2.1 The Balance Sheet The Balance Sheet of the U.S. Composite Corporation Balance Sheet Analysis When analyzing a balance sheet, the financial manager should be aware of three concerns: Accounting liquidity（会计流动性） Debt versus equity（债务与权益） Value versus cost（市价与成本） Accounting Liquidity Refers to the ease and quickness with which assets can be converted to cash. Current assets are the most liquid. Some fixed assets are intangible. The more liquid a firm’s assets, the less likely the firm is to experience problems meeting short-term obligations. Liquid assets frequently have lower rates of return than fixed assets. Debt versus Equity Generally, when a firm borrows it gives the bondholders first claim on the firm’s cash flow. Thus shareholder’s equity is the residual difference between assets and liabilities. Value versus Cost Under GAAP（Generally Accepted Accounting Principles） audited financial statements of firms in the U.S. carry assets at cost. China: Accounting Standards for Business Enterprises(企业会计准则 2006） Market value is a completely different concept. 2.2 The Income Statement The income statement measures performance over a specific period of time. The accounting definition of income is U.S.C.C. Income Statement U.S.C.C. Income Statement U.S.C.C. Income Statement U.S.C.C. Income Statement Income Statement Analysis There are three things to keep in mind when analyzing an income statement: GAAP Non Cash Items Time and Costs Generally Accepted Accounting Principles GAAP The matching principal of GAAP dictates that revenues be matched with expenses. Thus, income is reported when it is earned, even though no cash flow may have occurred I