About Financial Reporting and Analysis for the Level I CFA Exam

This forum contains discussion of Financial Reporting and Analysis topics for the Level I CFA exam.

  • Financial Reporting and Analysis is covered in Study Sessions 6, 7, 8 and 9
  • Financial Reporting and Analysis has an exam weight of 15%

Study Session 6

“This study session introduces the principal information sources used to evaluate a company’s financial performance. Primary financial statements (income statement, balance sheet, cash flow statement, and statement of changes in equity) in addition to notes to these statements and management reporting are examined. A general framework for conducting financial statement analysis is provided. The session also includes a description of the roles played by financial reporting standard-setting bodies and regulatory authorities.”
Source: CFA Institute

Study Session 7

"This study session addresses the three major financial statements—the income statement, the balance sheet, and the cash flow statement—by examining each in turn. The purpose, elements of, construction, pertinent ratios, and common-size analysis are presented for each major financial statement. The session concludes with a discussion of financial analysis techniques including the use of ratios to evaluate corporate financial health. "
Source: CFA Institute

Study Session 8

“This study session examines financial reporting for specific categories of assets and liabilities. Inventories, long-lived assets, income taxes, and non-current liabilities are examined in greater detail because of their effect on financial statements and reported measures of profitability, liquidity, and solvency. For these items in particular, the analyst should be attentive to chosen accounting treatment, corresponding effect on reported performance, and the potential for financial statement manipulation.”
Source: CFA Institute

Study Session 9

“This study session introduces the concept of financial reporting quality. The session examines the financial reporting quality differences that may exist between companies and the means for identifying them. Warning signs of poor or low quality reporting are covered. The application of financial analysis techniques to evaluate a company’s past and projected performance, assess credit risk, and screen for potential equity investments follows. Common adjustments to reported financials to facilitate crosscompany comparisons conclude the session.”
Source: CFA Institute