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Basics of Financial Statement Analysis: Financial Statements, Annual Reports, and Industry Ratios

This guide introduces some basic tools for financial statement analysis. Useful for projects in ACCT 100 and ACCT 210

Finding & Using Financial Statements

Financial statements are documents reporting a company’s financial performance to provide information for interested parties. The most important financial statements may include the balance sheet, income statement, statement of cash flows, and the shareholders’ equity statement.

You can find financial statements for publicly traded companies in the U.S. from several sources:

  • Companies' SEC filings, specifically the 10-K annual reports and 10-Q quarterly reports, either via the SEC or company web site (look for Investor Relations)
  • Value-added library databases
  • Free web finance sites

This page will describe the first two types.

  SEC Filings

SECPublicly-traded companies must file financial statements with the Securities and Exchange Commission (SEC), the body that oversees all U.S. stock exchanges. The most useful is the 10-K annual report, an official audited document that includes similar information from a prospectus or annual report, but provides additional updated financial information on corporate activities. Filings can be found at the SEC's Edgar Database.

Other commonly-sought filings include:

  • 10-Q: quarterly report
  • Proxy statements, including the DEF14-A
  • 8-K current event informational filings

These filings collectively are the source material for available financial statements and other factual data in our various subscription databases and many other free web company information sources.

What's EDGAR?

EDGAR is the Securities & Exchange Commission's (SEC) public website for finding and retrieving required periodic company information filings.

Use Mergent Online to Find Company Financial Statements and Annual Reports

Finding and Downloading Financials

  1. Find your company
  2. Click the Company Financials tab
  3. Change "Balance Sheet" to All Sections
  4. Select desired years or quarters
  5. Refresh
  6. Download to Excel

Finding and Downloading 10-K Annual or 10-Q Quarterly Reports

  1. From Mergent's main screen, click the Government Filings tab
  2. Enter your company name or ticker
  3. Select Last 12 months (or add custom date range)
  4. Change Filing Type to 10K & 10Q
  5. Search
  6. Select desired report and format (html, Word, Excel, pdf)

Videos: Financial Statement & Ratio Analysis

Here are a selection of streaming videos on financial statement and ratio analysis:

Find Industry Information in IBISWorld

IBISWorld logo

Industry Ratios: eStatement Studies

In eStatement Studies you'll find Financial Ratio Benchmark (FRB) figures, broken down by US Region and revenue quartile, and stratified by industry assets or sales, for a very large number of industries. 

Find an industry by keyword or NAICS code, then look in the first 3 columns. In each column, you'll find summary level common-sized balance sheet and income statements, as well as common financial ratios.

You can use these to compare the common-sized financials and ratios that you calculate for your company to these benchmarks for the industry.

Ratios in RMA

Ratios in RMA eStatement Studies

You can sort ratios by Assets or by Sales.

Using NAICS Codes in Industry Analysis

The North American Industry Classification System (NAICS) is used to organize industry information. It's designed to produce common industry definitions for Canada, Mexico, and the United States. It is a hierarchical classification system, offering five levels of detail. Codes are assigned to an industry based on products and services provided by the industry.

Industries are represented by a six-digit number. The first two digits designate the economic sector: manufacturing, agriculture, wholesale, retail, professional services, etc. The subsequent digits designate subsectors and industry groups.

Each digit in the code is part of a series of progressively narrower categories.


72 - Accommodation and Food Services

722 - Food Services and Drinking Places

7225 - Restaurants and Other Eating Places

722511 - Full Service Restaurants

The Standard Industrial Classification (SIC), an earlier U.S. system, is still used by some sources.