The Aleph Blog » Accounting


Financial Shenanigans (5 Stars)

The book is an easy read, and does not require detailed knowledge of accounting in order to get value out of it.  For fundamental investors, I recommend this book, with the proviso that it only works with non-financial companies.  Financial companies are more complex (they are all accruals — the cash flow statement is not very useful), and can’t easily be analyzed for earnings quality from looking at the financial statements alone.

To buy the book: Financial Shenanigans

Quality of Earnings (5 Stars)

Any investor could benefit from the book, particularly those that analyze fundamentals.

If you want to buy the book, you can buy it here: Quality of Earnings

Early Warning and Quick Response (4 Stars)

Users of financial statements that want to think a little more broadly about accounting should buy this book.  Note that the sticker price of this book is stiff, at roughly $1 per page.  Accounting mavens, whether they like the ideas should buy the book so that they can understand the issues involved.  Even if they never become the standards, the ideas are the exemplar for fair value, and represent the opposition view in accounting.

If you want to, you can buy it here: Early Warning and Quick Response: Accounting in the 21st Century (Studies in the Development of Accounting Thought).


David Merkel is an investment professional, and like every investment professional, he makes mistakes. David encourages you to do your own independent "due diligence" on any idea that he talks about, because he could be wrong. Nothing written here, at RealMoney, Wall Street All-Stars, or anywhere else David may write is an invitation to buy or sell any particular security; at most, David is handing out educated guesses as to what the markets may do. David is fond of saying, "The markets always find a new way to make a fool out of you," and so he encourages caution in investing. Risk control wins the game in the long run, not bold moves. Even the best strategies of the past fail, sometimes spectacularly, when you least expect it. David is not immune to that, so please understand that any past success of his will be probably be followed by failures.

Also, though David runs Aleph Investments, LLC, this blog is not a part of that business. This blog exists to educate investors, and give something back. It is not intended as advertisement for Aleph Investments; David is not soliciting business through it. When David, or a client of David's has an interest in a security mentioned, full disclosure will be given, as has been past practice for all that David does on the web. Disclosure is the breakfast of champions.

Additionally, David may occasionally write about accounting, actuarial, insurance, and tax topics, but nothing written here, at RealMoney, or anywhere else is meant to be formal "advice" in those areas. Consult a reputable professional in those areas to get personal, tailored advice that meets the specialized needs that David can have no knowledge of.

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