The Portable MBA in Finance and Accounting, 4th Edition

Preface

 

 

 

 

Since the third edition of this book was published in late 2001, much has happened to reshape the business world as we now know it. Our financial system almost collapsed. Stalwarts like Lehman Brothers and Merrill Lynch ceased to exist because they had assumed huge risk in financial instruments that were vastly overvalued. The mortgage market collapsed and along with it went a host of financial companies and banks that had invested in subprime mortgage-backed securities. Bernie Madoff went from obscurity to become a household name after allegedly bilking investors out of approximately $50 billion in the largest-ever Ponzi scheme. The stock market lost 35% of its value. Personal 401(k) retirement accounts were devastated, and people had to rethink their retirement plans. Companies planning to use their stock to finance the purchase of acquisitions found that the value of their stock had plunged. Credit became tight and financing difficult.

As a result of the Enron scandal, corporate governance has become a hot topic, with potential liability for CEOs and CFOs and with much increased and highly expensive and cumbersome added requirements for internal control imposed by the 2002 Sarbanes-Oxley Act.

All of these issues have created a new financial world that requires special skills for a manager to succeed. Do you have those skill sets?

Do you know how to accomplish these important business tasks?

• Understand financial statements.

• Measure liquidity of a business.

• Analyze ...