Karka

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Karka

  1. 1. COMPANY INFORMATION Financial information
  2. 2. PRIVATE VS. PUBLIC COMPANIES <ul><li>PRIVATE: </li></ul><ul><ul><li>closely held companies </li></ul></ul><ul><ul><li>stocks not available to general public and not traded on stock exchanges </li></ul></ul><ul><ul><li>generally, not required by law to disclose financial information </li></ul></ul><ul><li>PUBLIC: </li></ul><ul><ul><li>stocks available on the open market </li></ul></ul><ul><ul><li>stocks traded on stock exchanges </li></ul></ul><ul><ul><li>required by law to disclose certain financial information </li></ul></ul>
  3. 3. FINANCIAL STATEMENTS <ul><li>Statement of Financial Position (Balance Sheet) </li></ul><ul><ul><li>an overview of company’s value </li></ul></ul><ul><li>Income Statement </li></ul><ul><ul><li>records the flow of money in and out the company </li></ul></ul><ul><li>Statement of Stockholders’ Equity </li></ul><ul><ul><li>shows the change in company’s capital structure </li></ul></ul><ul><li>Statement of Cash Flow </li></ul><ul><ul><li>shows how the cash was generated </li></ul></ul>
  4. 4. PUBLIC FILINGS (disclosure statements) <ul><li>Annual report to stockholders (ARS) </li></ul><ul><li>10-K Report </li></ul><ul><li>Proxy Statement </li></ul>
  5. 5. Reasons and the legal basis for disclosure <ul><li>Market crash 1929 </li></ul><ul><li>Securities Act of 1933 </li></ul><ul><li>Securities and Exchanges Act of 1934 </li></ul><ul><li>U.S. Securities and Exchange Commission </li></ul>
  6. 6. Annual Report to Stockholders (ARS) <ul><li>the letter from the chairman of the board </li></ul><ul><li>independent auditor’s report </li></ul><ul><li>financial statements </li></ul><ul><ul><li>balance sheet </li></ul></ul><ul><ul><li>income statement </li></ul></ul><ul><ul><li>statement of changes in fin. position </li></ul></ul><ul><ul><li>comparison across the years </li></ul></ul><ul><li>discussion and analysis </li></ul>
  7. 7. 10-K Report <ul><li>filed with the Securities and Exchange Commission </li></ul><ul><li>most exhaustive financial disclosure </li></ul><ul><li>two sections: </li></ul><ul><ul><li>financial information </li></ul></ul><ul><ul><li>supporting data </li></ul></ul><ul><li>usually more detailed than ARS </li></ul>
  8. 8. Proxy Statement <ul><li>official notice to stockholders before the annual meeting </li></ul><ul><li>information on ownership and management </li></ul><ul><li>bio’s and salaries of officers and executives </li></ul><ul><li>information on mergers </li></ul>
  9. 9. CREDIT REPORTS <ul><li>provide an analysis of company’s payment record, financial status, and background information </li></ul><ul><li>Dun & Bradstreet Corp . : leading supplier of credit information, controls 90% of market </li></ul><ul><li>Experian (was TRW till 1996): </li></ul><ul><ul><li>emphasis on smaller companies, information on proprietorships </li></ul></ul>
  10. 10. Regulated Companies <ul><li>involved in activities of major importance for public welfare (i.e. banking, public utilities, airlines) </li></ul><ul><li>required to submit fin. and operating info. to government agencies even though they are not publicly traded </li></ul>
  11. 11. Where to find financial information about a private company? <ul><li>commercial credit reporting agencie </li></ul><ul><li>local publications </li></ul><ul><li>directory comparisons </li></ul><ul><li>indirect sources: </li></ul><ul><ul><li>Wall Street research reports </li></ul></ul><ul><ul><li>industry norms and comparisons </li></ul></ul>
  12. 12. Where to find financial information about a public company? <ul><li>from a company itself </li></ul><ul><li>SEC reading room </li></ul><ul><li>EDGAR </li></ul><ul><li>SEC Disclosure </li></ul><ul><li>Moody’s Manuals </li></ul><ul><li>Standard & Poor’s Corporation Records </li></ul>
  13. 13. Moody’s Manuals <ul><li>8 parts with 15 hard-bound volumes </li></ul><ul><li>grouped according the type of company </li></ul><ul><li>examples: </li></ul><ul><ul><li>industrial </li></ul></ul><ul><ul><li>bank & finances </li></ul></ul><ul><ul><li>international.... </li></ul></ul><ul><li>more than 15,000 companies </li></ul>
  14. 14. Standard & Poor’s Corporation Records <ul><li>loose-leaf service </li></ul><ul><li>6 volumes </li></ul><ul><li>faster updating than Moody’s </li></ul><ul><ul><li>daily update in “Daily News” </li></ul></ul><ul><li>coverage of 9,000 companies </li></ul>

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