Sprint Filings

The Financial Statement Avenger was a "big" hit at this year's American Institute of Certified Public Accountants meeting


Reading a financial statement is a lot like having sex with a fat girl - you're oddly intrigued, you're not sure where to start, and you really hope your friends don't find out about it later. And let's just say I know what I'm talking about as I just read Sprint's latest 10-Q statement. Not to mention I've been with more fat girls than Jenny Craig. In all instances, it ended up being a much larger undertaking than I initially expected yet, no matter how painful the experience, I felt compelled to finish the job . So it is with me and the 10-Q.

For the unaware, the 10-Q is a federally mandated form all publicly traded companies must file with the SEC. The 10-Q includes unaudited financial statements and provides a continuing view of the company's financial position during the year and the report must be filed for each of the first three fiscal quarters of the company's fiscal year.

In order to understand a financial statement let's first define what exactly we are going to be looking at. There are four main parts of a financial statement:

1. Balance Sheet - details information on the company's assets (what they own) and liabilities (what they owe).
2. Income Statement - how much revenue the company earned over a period of time.
3. Cash Flow Statement - the company's inflows and outflows of cash; needed to pay its expenses and purchase any assets. It is derived from the balance sheet and income statements.
   
4. Statement of Shareholders' Equity - the money that would be left if a company sold all of its assets and paid off all of its liabilities. Sometimes called net worth or capital.

The first 3 are the most important as they can be used (hopefully) to show the financial health of the company. Or, at least, the trend of the health of the company. Even then, understanding all the accounting nuances can be difficult to incorporate into any analysis. That is the goal, though; to come up with a rational, objective measurement of Sprint's financial health. But, like I tell the chubby chicks, "I aim to please but you should just be happy that you're getting something for free." Since the 10-Q is 36 pages of information and since I have a life (a TV does not watch itself, after all), I'm going to break down the the various parts of the financial statement into a series of upcoming posts. Think the Friday the 13th series - although hopefully infinitely more entertaining. To be continued...