Latest letters
- New
Start with the chair’s letter, then read what it leaves out
The chair’s letter is the part everyone reads and the part that says least. What to look for, and what to read next.
The income statement in five lines
Revenue, costs, tax and profit: how five lines hold the whole income statement, and where the other lines hide.
Cash flow: where the money actually went
Profit is not cash. How to follow the cash through three parts of a report and see where it went.
Read the notes before the numbers
Why I turn to the notes first, and the three I read before I look at a single figure.
Red flags in the footnotes, and what they are not
Some footnotes are worth a closer read. Here is what I look for, and what is only a legal phrase.
What the word revenue is hiding
Revenue is counted when a company says it has earned it, and that can be a different day from when the money arrives.
Working capital on a morning tram
Money owed to a company, money it owes and the stock in between, drawn on one page between two stops.
How a balance sheet balances
Everything a company owns equals everything it owes plus what is left for its owners. Why that must be true.
An annual report in one evening
A plain order for reading a whole report in an evening, with a pencil, a pot of tea and no hurry.
What the auditor’s page really says
One page near the back that most people skip, and the few sentences in it that are worth reading slowly.
Free
Plain Reports
One plain letter every Thursday on how to read an annual report, with a part of the report to try for yourself.