CFA Level I · CFA Level I Exam · Introduction to Financial Statement Analysis
Within an annual report, the section that is most likely to provide management's discussion of the company's financial condition, results, and known trends and uncertainties is the:
The management commentary, also called management's discussion and analysis, provides management's view of financial condition, results, and known trends and uncertainties. The auditor's report gives an opinion on the statements, and the statement of changes in equity only reconciles equity balances.
- Amanagement commentaryCorrect
- Bauditor's report
- Cstatement of changes in equity
Explanation
Management commentary (MD&A) offers management's view of performance, liquidity, capital resources and known trends or uncertainties. The auditor's report gives an opinion on the statements, and the statement of changes in equity is a primary financial statement with no narrative discussion.
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