From the course: Corporate Financial Statement Analysis

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Excel: Spot comparability pitfalls in global financials

Excel: Spot comparability pitfalls in global financials

From the course: Corporate Financial Statement Analysis

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Excel: Spot comparability pitfalls in global financials

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In the Limitations Excel workbook, the first tab is titled FedEx DHL, so make sure you're on this tab right here. These are income statement numbers for DHL and FedEx, two international shipping companies. We're going to use these numbers and some additional numbers for three Chinese state-owned airlines to see that doing a financial statement comparison can be muddled and misleading just because of something as simple as expense classification. You'll note that the numbers in these examples are a little old. 2016 and 2017 for the FedEx and DHL numbers, and we'll see that the numbers are 2007 for the Chinese airlines. I'm using these old numbers because I've been using these examples in classrooms for years. I like these examples, so we'll use these numbers. Let's start by comparing the income statements for FedEx and DHL. FedEx in the left-hand column, DHL in the right-hand column. Both FedEx and DHL are global shipping companies, so it makes sense to compare the financial statements…

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