- CFA Exams
- 2025 Level II
- Topic 3. Financial Statement Analysis
- Learning Module 15. Integration of Financial Statement Analysis Techniques
- Subject 1. A Financial Statement Analysis Framework
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Subject 1. A Financial Statement Analysis Framework PDF Download
According to the framework there are six phases:
- Define the purpose and context of the analysis. The purpose can be evaluating equity/debt investment, issuing a credit rating, etc.
- Collect input data. The sources include financial statements, footnotes, supplementary schedules, MD&A, company web sites, press releases, etc.
- Process input data. Make necessary adjustments, calculate ratios, prepare common-size statements, etc.
- Analyze / interpret the data. A financial statement does not prove useful unless interpreted correctly.
- Draw conclusions and prepare presentations. Examples are analytical reports and recommendations.
- Follow up. Are there any changes / recent updates?
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