A lot of strange things can occur in financial statements that have perfectly logical explanations. These were brought about by the inherent inconsistencies in the current set of financial reporting standards.
To understand the quality of a company’s financials, you need to understand the quality of the management team as well as the auditors who are preparing the numbers.
In this 90-minute afternoon session titled, “Forensic Accounting: Going Beyond the Numbers into the Words,” Prof. Joel Litman, Chairman and CEO of Valens Research, will discuss a combination of financial and research tools to identify bad players and management teams who may be acting unethically. These tools include fundamental forensics, earnings call forensics, and forensic accounting.
The firm’s forensic accounting tool stemmed from its Uniform Adjusted Financial Reporting Standards (UAFRS) framework, known as “Uniform Accounting.” Through the UAFRS framework, Valens Research was able to identify more than a hundred inconsistencies in the financial statements under GAAP/IFRS.
The use of Uniform Accounting, spearheaded by the Chairman of the UAFRS Council, Prof. Joel Litman, makes company performance indicators incomparable over time, as these principles have changed over time, along with a company’s choice of electives.
These issues are highlighted by the extensive research and documentation of the inconsistencies, misclassifications of categories and terminology, and lack of reliability of as-reported financial statements under GAAP/IFRS.
Litman’s analyses are read by tens of thousands of investors and executives every week. His research is used by more than 230 of the 300 largest investment managers in the world, including all of the top ten.
Litman has lectured and advised at top programs like Harvard Business School and London Business School, for the US government, including the Pentagon and US Marine Corps War College, for CFA Societies and investment teams from New York to Istanbul to Tokyo, and for leadership of the world’s largest firms such as PwC and Credit Suisse.
Litman has been interviewed on CNBC, quoted in the Wall Street Journal’s Barron’s Magazine and Institutional Investor, and is a regular author in Forbes. He published “Give My Regrets to Wall Street” in Harvard Business Review. Litman co-authored the highly-acclaimed book, “DRIVEN: Business Strategy, Human Actions, and the Creation of Wealth.”
As Chairman of the UAFRS Council, Litman has spearheaded the global use of Uniform Accounting for investment decisions and strategic business analysis. Professor Litman holds trademarks and patents in a wide array of strategic and financial analyses.
Litman is a member of the CFA Institute, the global association for investment professionals, and the Association of Certified Fraud Examiners. He is a CPA (Certified Public Accountant), received a B.S. in Accounting from DePaul University, and an MBA/MM from the Kellogg Graduate School of Management at Northwestern University.