International Financial Statement Analysis Workbook

PRACTICE THE CONCEPTS, TOOLS, AND TECHNIQUES OF INTERNATIONAL FINANCIAL STATEMENT ANALYSIS

International Financial Statement Analysis Workbook gives busy professionals and those aspiring to a financial career a hands–on resource for understanding and applying the concepts and methodologies essential to accurate financial analysis. A companion to the International Financial Statement Analysis text, this practical workbook includes learning objectives, chapter summaries, and problems that are designed to build skills and boost confidence before applying the concepts to real–world cases.

The workbook offers an opportunity to test your understanding of the standards and mechanics of financial reporting and makes use of the text′s tools and techniques. This informative guide which has practical application across international borders aids in the understanding of financial reporting mechanics, income statements, balance sheets, cash flow statements, inventories, long–lived assets, income taxes, and much more. International Financial Statement Analysis Workbook is designed to facilitate information retention and build a strong foundation in financial statement analysis.

It′s impossible to tell how well a subject is mastered without applying the relevant concepts to situations based in the real world. International Financial Statement Analysis Workbook offers the opportunity to:

Work topic–specific practice problems to facilitate intuitive understanding Review each topic quickly using clear chapter summaries Understand each chapter′s objective to avoid missing key information Practice important methods and techniques before applying them in the real world

International Financial Statement Analysis Workbook, Third Edition provides the most up–to–date knowledge and helps to apply the knowledge with carefully constructed problems.

PART I

Learning Outcomes, Summary Overview, and Problems

CHAPTER 1

Financial Statement Analysis: An Introduction 3

Learning Outcomes 3

Summary Overview 3

Problems 5

CHAPTER 2

Financial Reporting Mechanics 7

Learning Outcomes 7

Summary Overview 7

Problems 8

CHAPTER 3

Financial Reporting Standards 13

Learning Outcomes 13

Summary Overview 14

Problems 15

CHAPTER 4

Understanding Income Statements 19

Learning Outcomes 19

Summary Overview 20

Problems 21

CHAPTER 5

Understanding Balance Sheets 25

Learning Outcomes 25

Summary Overview 25

Problems 27

CHAPTER 6

Understanding Cash Flow Statements 31

Learning Outcomes 31

Summary Overview 31

Problems 32

CHAPTER 7

Financial Analysis Techniques 37

Learning Outcomes 37

Summary Overview 37

Problems 38

CHAPTER 8

Inventories 45

Learning Outcomes 45

Summary Overview 45

Problems 47

CHAPTER 9

Long–Lived Assets 61

Learning Outcomes 61

Summary Overview 62

Problems 64

CHAPTER 10

Non–Current (Long–Term) Liabilities 73

Learning Outcomes 73

Summary Overview 73

Problems 75

CHAPTER 11

Financial Reporting Quality 79

Learning Outcomes 79

Summary Overview 79

Problems 80

CHAPTER 12

Financial Statement Analysis: Applications 83

Learning Outcomes 83

Summary Overview 83

Problems 84

CHAPTER 13

Income Taxes 87

Learning Outcomes 87

Summary Overview 88

Problems 88

CHAPTER 14

Employee Compensation: Post–Employment and Share–Based 93

Learning Outcomes 93

Summary Overview 93

Problems 94

CHAPTER 15

Intercorporate Investments 101

Learning Outcomes 101

Summary Overview 101

Problems 102

CHAPTER 16

Multinational Operations 111

Learning Outcomes 111

Summary Overview 112

Problems 114

CHAPTER 17

Evaluating Quality of Financial Reports 121

Learning Outcomes 121

Summary Overview 121

Problems 123

CHAPTER 18

Integration of Financial Statement Analysis Techniques 125

Learning Outcomes 125

Summary Overview 125

Problems 126

PART II

Solutions

CHAPTER 1

Financial Statement Analysis: An Introduction 135

Solutions 135

CHAPTER 2

Financial Reporting Mechanics 137

Solutions 137

CHAPTER 3

Financial Reporting Standards 141

Solutions 141

CHAPTER 4

Understanding Income Statements 143

Solutions 143

CHAPTER 5

Understanding Balance Sheets 145

Solutions 145

CHAPTER 6

Understanding Cash Flow Statements 147

Solutions 147

CHAPTER 7

Financial Analysis Techniques 151

Solutions 151

CHAPTER 8

Inventories 155

Solutions 155

CHAPTER 9

Long–Lived Assets 161

Solutions 161

CHAPTER 10

Non–Current (Long–Term) Liabilities 165

Solutions 165

CHAPTER 11

Financial Reporting Quality 167

Solutions 167

CHAPTER 12

Financial Statement Analysis: Applications 171

Solutions 171

CHAPTER 13

Income Taxes 173

Solutions 173

CHAPTER 14

Employee Compensation: Post–Employment and Share–Based 175

Solutions 175

CHAPTER 15

Intercorporate Investments 179

Solutions 179

CHAPTER 16

Multinational Operations 183

Solutions 183

CHAPTER 17

Evaluating Quality of Financial Reports 187

Solutions 187

CHAPTER 18

Integration of Financial Statement Analysis Techniques 189

Solutions 189

About the CFA Program 193

THOMAS R. ROBINSON, PHD, CFA, is Managing Director of the Americas at CFA Institute.

ELAINE HENRY, PHD, CFA, is a Clinical Associate Professor of Accounting at Fordham University.

WENDY L. PIRIE, PHD, CFA, is Director, Curriculum Projects, in the Education Division at CFA Institute and served as editor for this book.

MICHAEL A. BROIHAHN, CFA, is Associate Professor of Accounting at Barry University in Miami Shores, Florida.