More of this Feature • Part 1: Lesson 3 Main • Part 2: How to Get Statements • Part 3: What's a Balance Sheet • Part 4: Typical Balance Sheet • Part 5: Current Assets • Part 6: Receivables • Part 7: Receivable Turns • Part 8: Inventory • Part 9: Inventory Turns • Part 10: Inventory Example • Part 11: Prepaid Expenses • Part 12: Current Liabilities • Part 13: Working Capital • Part 14: WC Per Dollar of Sales • Part 15: Negative Work. Cap • Part 16: Current Ratio • Part 17: Quick Ratio • Part 18: Long Term Investment • Part 19: Property, Plant, Equip. • Part 20: Intangible Assets • Part 21: Goodwill • Part 22: Deferred Charges • Part 23: Debt, Debt to Equity • Part 24: Other Liabilities • Part 25: Minority Interest • Part 26: Shareholder Equity • Part 27: Book Value • Part 28: Com. & Pref. Shares • Part 29: Cap. Surplus, Reserve • Part 30: Treasury Stock • Part 31: Retained Earnings • Part 32: Formula & Calculations • Part 33: Putting it all Together • Part 34: Segment 2

Related Resources • Investing Lesson 1 • Investing Lesson 2 • Investing Lesson 3 • More Investing Lessons

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How to Get a Copy of a Company's Balance Sheet

Since you can't do your analysis without a balance sheet, you're going to have to get your hands on one.  How do you get a company's financial statements?  Generally, you should look in one of three places.

1.) The Annual Report: The annual report is a document released by companies at the end of their fiscal year which includes almost everything an investor needs to know about the business.  It generally contains pictures of facilities, branch offices, employees, and products [all of which are completely unimportant to making your investing decision.]  They are normally followed by a letter from the CEO and other senior management which discusses the past as well as upcoming year.  Tucked away in the back of most annual reports is a collection of financial documents.  Most of the time you can go onto a company's website and find the Investor Relations link.  From there, you should be able to either download the annual report in PDF form or find information on how to contact shareholder services and request a copy in the mail.

2.) The 10K: This is a document filed with the SEC which contains a detailed explanation of a business.  It is reported annually and contains the same financial statements the annual report does, in a more detailed form.  The benefit of the 10K is that it allows you to find out additional information such as the amount of stock options awarded to executives at the company, as well as a more in-depth discussion of the nature of the business and marketplace.  Sometimes you will find that a company has no financial statements in the 10K, but instead has written, "incorporated herein by reference"  This means that the financial statements can be found elsewhere [such as in the annual report or another publication].   Even if this is the case, it is still worth it to get a copy.  You can find this by contacting the company, visiting their website, or going to FreeEdgar (freeedgar.com) or SEC.gov.

3.) The 10q:  The is similar to the 10k, but is filed quarterly [four times a year - normally the end of January, June, September, and December].  If the company is planning on changing its dividend policy, or something equally as important, they may bury it in the 10q.  These documents are critical and can be obtained in the same way as the annual report and 10k.

You will want to get a copy of all three documents for the past year or two from the company you are interested in investing in.  Most of them can be found at http://finance.yahoo.com - type in the ticker symbol of the company you want to research and then click the "financials" link.  This will bring up a copy of the latest quarterly financial statements.  (For all good purposes, I would recommend you first analyze the annual balance sheet, which can be found by clicking "annual data" in the upper right hand corner.)  Another excellent source of financial statements is The Street.  As always, it is best to get the information directly from the company.

Next page > What is a Balance Sheet? >  1, 2, 3, 4, 5, 6, 7,  more >>