The Finance Professor: Getting Started With Financial Statements

Form 10-K: This is an official filing made by the company to the Securities & Exchange Commission (SEC). On the face of the 10-K will be a statement to this effect:

"Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended [1996]."

The 10-K will contain the following sections:

• An overview of the company and selected financial data
• Director and senior management information including executive compensation, as well as signatures by senior management and the directors
• Consolidated financial statement including the Report of Independent Registered Public Accounting Firm
• Notes to the financial statements

Form 10-Q: This is the quarterly and slimmed-down version of the 10-K. It typically only includes unaudited financial statements, notes to the financial statements and a management discussion.

Annual Report: This publication is sent to all shareholders and is available from the company for prospective investors. The annual report varies from company to company. Some companies, such as Ruth's Chris Steak House (RUTH Quote), just slap a glossy cover over a 10-K and call that an annual report (click here to see Ruth's recent annual reports).

On the other hand, some companies, such as Amylin Pharmaceutics (AMLN Quote), put together a professionally designed annual report (click here to see Amylin's 2006 annual report) that incorporates a message to shareholders; a business overview featuring (but not limited to) the company's management, products, operations and new endeavors; the auditors' report; consolidated financial statements; and notes to all of those statements.

Yet another spin is the summary annual report as presented by Duke Energy (DUK Quote). Duke issues a summary annual report with plenty of gloss, a business overview and financial statements. However, ultimately, the Duke report refers readers to its 10-K for more details (click here to see Duke's 2006 summary annual report).