Introduction to Financial Statement Analysis – Module 1 – FSA– CFA® Level I 2025

Download PDF Now: https://www.finquiz.com/cfa/level-1/summary/ 2025 Prep Packages for the CFA® Program exam offered by FinQuiz Pro (notes, summaries, question bank, mock exams, and formula sheet): Level I: https://www.finquiz.com/cfa/level-1/ Level II: https://www.finquiz.com/cfa/level-2/ Level III: https://www.finquiz.com/cfa/level-3/ Begin your CFA® journey with our comprehensive Introduction to Financial Statement Analysis, tailored for CFA Level I candidates preparing for the 2024 and 2025 exams. In Module 1 of our Financial Statement Analysis (FSA) series, we delve into the fundamentals of Financial Statement Analysis, a crucial component of the CFA Level I Curriculum. This video is an essential resource for your CFA Exam Preparation, aligning with the latest CFA 2025 Curriculum. Gain a solid understanding of Accounting Basics and learn how to interpret and analyze the three primary Financial Statements for CFA: the income statement, balance sheet, and cash flow statement. Key Topics Covered: 0:00 Introduction to Financial Statement Analysis - Overview of why financial analysis is crucial - Backstage pass to a company’s financial performance - Importance for CFA candidates, investors, and creditors 0:27 Why Do Financial Analysis? - Decision-making for investors and creditors - Identifying debt repayment ability vs. profitability for equity holders - How financial analysis reveals a company’s future potential 1:23 The Step-by-Step Framework 1. Articulate the purpose (investment, credit risk, etc.) 2. Collect input data (financial statements, economic indicators, industry news) 3. Process data (ratio calculations, common-size statements) 4. Analyze & interpret (spot trends, identify red flags) 5. Develop conclusions & recommendations (tailor to your audience) 6. Follow up for ongoing assessment 4:45 Scope of Financial Statement Analysis - Evaluating past, current, and prospective financial positions - Differing focuses: equity analysts look at long-term earnings; creditors focus on liquidity - Example: Using the current ratio to gauge short-term obligations 5:34 Role of Regulations - How the SEC (US) and other regulators ensure consistent reporting - Importance of 10-K filings for detailed financial and management information - Differences between regulatory bodies (FASB vs. IASB) 6:41 Accounting Standards (IFRS vs. US GAAP) - Key differences (LIFO usage under US GAAP, inventory write-down reversals under IFRS) - Impact of these differences on reported income and analysis - Why analysts must adjust for cross-border comparisons 7:45 Additional Resources & Industry Insights - Beyond financial statements: earnings calls, press releases, industry reports - How major announcements or acquisitions can reshape financial forecasts - Importance of management’s tone and context 9:12 Conclusion & CFA Exam Tips - Recap of the importance of a solid framework - How financial analysis skills go beyond exam success - Encouragement to keep practicing for real-world decision-making