Ten hard questions to ask or be asked
| 1 | What did the balance sheet look like a day, week or month before this one was drawn up? |
| 2 | How is this one different from previous balance sheets? |
| 3 | What is the quality of assets? What could be liquidated, and at what market value? |
| 4 | How realistic are inventory valuation and depreciation policies? (See also Ten hard questions in Chapters 11 and 13.) |
| 5 | How strong is working capital – current assets less current liabilities? |
| 6 | What is the balance of total assets less total liabilities? |
| 7 | Are these significant near-term liabilities (accruals, taxes, loan repayments) which have to be met from cash flow? |
| 8 | What is off balance sheet? What contingent liabilities and assets are lurking? |
| 9 | What is the structure of debt? ... |
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