🎉 Happy New Year to everyone!
In this post, I want to announce a project I’ve been working on for quite some time — and one I’m genuinely thrilled to finally share with you.
Most investors spend their time on stories, narratives, and market opinions.
But the real story of a business is written somewhere else:
in the financial statements.
Balance sheets, income statements, cash flows — they are not just compliance documents. They are the language of business. And if you don’t speak that language fluently, you are always relying on someone else’s interpretation.
That’s why I’m starting a new long-term project here on Substack:
Accounting for Investors
A practical, investor-focused guide to understanding accounting — not as an accountant, but as someone who wants to make better investment decisions.
Why I’m Writing This
Accounting is often taught as:
technical
rule-based
boring
disconnected from real investing
That’s a mistake.
For investors, accounting is:
a framework for understanding business reality
a filter for separating signal from noise
a tool for detecting risk, quality, and manipulation
a bridge between numbers and valuation
You don’t need to become an accountant.
But you do need to understand how numbers are created, what they mean, and where they can mislead you.
This series is written for:
long-term investors
fundamental analysts
curious minds who want to go beyond headlines and ratios
No unnecessary jargon.
No exam-style explanations.
Always from an investor’s perspective.
I also write this from direct professional experience. I work in a fundamental accounting and reporting function (Grundsatzabteilung) of a publicly listed DAX company, where accounting is not theory, but the basis for real-world decisions, disclosures, and investor communication.
That perspective shapes this book.
Not how accounting should work in textbooks — but how it actually works in practice, where judgment, incentives, regulation, and business reality intersect.
How This Will Work
Each chapter will be published bi-weekly
Paid subscribers only
Over time, these chapters will form a complete book
Once finished, the full book will also be published for sale
Paid Subscribers get:
early access
the full, unfiltered content
a structured learning path instead of scattered posts
Think of this as compounding knowledge, not a quick read.
Content Overview
Accounting for Investors
Understand the Numbers. Master the Business. Invest Smarter.
Part I – The Language of Business
Goal: Build intuitive understanding of accounting concepts — without jargon.
Why Investors Need Accounting
The link between accounting and investing decisions
How financial statements reveal the story behind a company
Limitations and pitfalls of accounting data
The Accounting Framework
The logic behind double-entry bookkeeping
Accrual vs. cash accounting
Key principles (conservatism, materiality, matching, etc.)
IFRS vs. US GAAP – what investors must know
The Balance Sheet: What the Company Owns and Owes
Assets: tangible, intangible, current, non-current
Liabilities and equity explained simply
How to read balance sheet strength
Hidden risks (off-balance-sheet items, goodwill, etc.)
The Income Statement: How Profits Are Made (or Lost)
Revenues, costs, and profit margins
Non-recurring items and accounting tricks
EBIT, EBITDA, and why they matter
Earnings quality and red flags
The Cash Flow Statement: Follow the Money
Operating vs. investing vs. financing cash flow
How cash flow reconciles with profit
Free cash flow and shareholder returns
Part II – From Numbers to Insight
Goal: Teach investors how to interpret and connect the data.
Connecting the Three Statements
How balance sheet, income, and cash flow interact
The circular flow of profits, assets, and financing
Key Ratios Every Investor Should Know
Profitability ratios (ROE, ROA, margins)
Liquidity and solvency (current ratio, debt ratios)
Efficiency and growth (asset turnover, working capital)
Valuation ratios (P/E, P/B, EV/EBITDA)
Earnings Quality and Manipulation
Accounting red flags: revenue recognition, provisions, depreciation
Creative accounting in practice (case studies: Wirecard, Enron, etc.)
How to detect unsustainable profits
Reading Between the Lines
Notes to the financial statements
Segment reporting, related parties, and contingencies
Management discussion and auditor’s report
Part III – Applying Accounting in Investment Decisions
Goal: Move from understanding to practical investing.
Analyzing Business Models Through Accounting
Asset-heavy vs. asset-light businesses
Subscription vs. transactional models
Cyclical vs. stable industries
Valuation Basics for the Accounting-Minded Investor
Intrinsic value and discounted cash flow
Relative valuation and accounting adjustments
Adjusting reported figures for valuation accuracy
Accounting and ESG
How sustainability impacts financial reporting
Capitalizing vs. expensing “green” investments
Reading ESG reports with a financial lens
Banking, Insurance, and Financial Institutions
Why their balance sheets look “upside down”
How investors should read financial sector accounts
Growth vs. Value: Accounting Realities Behind Investment Styles
Why accounting favors some business models over others
Capitalization of R&D and its impact on “growth” companies
The Limits of Accounting
Intangibles and the knowledge economy
When numbers stop telling the full story
Part IV – Mastery
Goal: Deepen insight and provide investor’s checklists.
How to Analyze an Annual Report (Step-by-Step)
Practical walkthrough with a real company example
How to extract the key investment insights in 60 minutes
Investor’s Accounting Toolkit
Templates for analysis
Ratios, adjustments, and data sources
Case Studies
Successful investments based on accounting insight
Accounting failures that fooled the market
The Future of Accounting for Investors
Digital reporting, AI, and data transparency
How investors will analyze companies in future
If you want to move beyond headlines and truly understand what businesses are telling you through their numbers, this series is for you. The first chapter will be released on January 10, 2026.
Don’t miss the start of Accounting for Investors.
Subscribe now to get access to every chapter as it’s published — and to build a skill that compounds for a lifetime.