Page 118 - Finance for Non-Financial Managers

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Critical Performance

Factors:

Finding the “Hidden”

Information

ow that you’re familiar with all the foundation financial
Nstatements that most companies use, you may feel pretty
well prepared to understand how well a company is doing finan-
cially. And you’d be right, compared with most folks. Since
most companies don’t prepare all those reports every month
and most people who read them don’t really understand how
much information they contain, you are decidedly ahead of
most of your peers in this area. And since you don’t likely plan
to become a financial analyst, that should cover you pretty well.
Why would you even want to go digging for “hidden” informa-
tion that isn’t on the basic financial reports? Why critical per-
formance factors (CPFs)?
The answer is ... “It all depends.”
If you run the company, it’s because your banker will want
to see the information. And your other lenders. And your audi-
tors. And the securities analysts who follow your stock. They
will all want to see them, because they want to see what’s
behind the basic financial statements, the strengths and weak-

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