Disclosure: What Next?

Abstract The primary reason for analyzing quantitative data is to secure clues as to future performance. The analyst's task is one of comparison of changing overall economic conditions and of specific company financial data through the years. Analysts look for trends and changes in major items. Thus financial reports should be oriented toward facilitating comparisons. The article "Disclosure: 1957," published in the previous issue of The Accounting Review emphasized that financial analysts are the major consumers of the published data issued by management with the aid of accountants. The drafters of published reports must remember that the analyst is faced with the task of comparison of results between years and between similar firms. The desires sufficient information so that he may carry out his task of comparison without the need of making arbitrary assumptions concerning a firm's accounting procedures and policies. Moreover, from the viewpoint of the security analyst the income statement dwarfs the balance sheet in importance. Future earning power is the major consideration. Past earnings performance is dissected in order to delineate trends.