[Verse 1] Balance sheet equation never bends or breaks Assets equal liabilities plus what the owners take Left side shows the treasures that the company commands Right side tells the story of where funding lands Cash and inventory, buildings standing tall Matched against the debts and equity that fund it all [Chorus] A-L-E, assets liabilities equity Revenue minus expenses shows profitability Operating investing financing flows Three statements paint the picture every analyst knows GAAP or IFRS, standards guide the way Turning business heartbeats into numbers every day [Verse 2] Income statement captures every dollar earned and spent Revenue recognition when the customer's content Accrual beats the cash method, matching is the key Record when it happens, not when money's finally free Profitable on paper but the cash vault running dry That's why three statements tell a truth that one would lie [Chorus] A-L-E, assets liabilities equity Revenue minus expenses shows profitability Operating investing financing flows Three statements paint the picture every analyst knows GAAP or IFRS, standards guide the way Turning business heartbeats into numbers every day [Bridge] DuPont breaks down ROE Margin times efficiency Times the leverage multiplied Ratios reveal what's hidden inside Current quick and debt-to-equity Turnover tells velocity [Verse 3] Footnotes whisper secrets that the statements never shout Management's discussion reveals what they're thinking about Off-balance mysteries lurking in the shadows deep Operating leases, SPEs, promises they keep Cost allocation splits the burden, direct and indirect ABC costing maps activities architects perfect [Chorus] A-L-E, assets liabilities equity Revenue minus expenses shows profitability Operating investing financing flows Three statements paint the picture every analyst knows GAAP or IFRS, standards guide the way Turning business heartbeats into numbers every day [Outro] Book value, market value, often worlds apart Financial analysis is both science and art Variance from budget tells the planning tale Numbers never lie but context tips the scale
← Management Communication (WHCP 6160 or 6180) | Corporate Finance (FNCE 6110 or 6210) →