Monday, January 21, 2019
Differences in Earnings Releases and 10-Ks

Wednesday, January 16, 2019
The Importance of Textual Analysis

Tuesday, January 8, 2019
A Look at Climate Change Disclosures

Wednesday, January 2, 2019
Quants: Point-in-Time Data for Backtesting

Friday, December 28, 2018
Now Showing: Controls & Procedures

Thursday, December 27, 2018
A Reminder on Non-GAAP Reporting Rules

Monday, December 17, 2018
Researching PG&E’s Wildfire Risk

Wednesday, December 12, 2018
Tracking Brexit Disclosures

Thursday, December 6, 2018
Campbell Soup: Looking Behind the Label

Sunday, December 2, 2018
SEC Comment Letters: The Amazon Example

Wednesday, November 28, 2018
Measuring Big Pharma’s Chemical Dependency

Monday, November 26, 2018
Analysts, Can You Relate? A True Story

Monday, November 19, 2018
Digging Up Historical Trend Data: Quest Example

Sunday, November 11, 2018
Cost of Revenue, SG&A: Q3 Update

Monday, November 5, 2018
Lease Accounting: FedEx vs. UPS

Saturday, November 3, 2018
New Email Alerting Powers

Wednesday, October 31, 2018
PTC and Two Tales of Revenue

Tuesday, October 30, 2018
10-K/Q Section Text Change Detection

Sunday, October 28, 2018
Finding Purchase Price Allocation

Sunday, October 21, 2018
Charting Netflix Growth in Three Ways

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Each 10-K a company files includes an Auditor’s Report. In that letter, addressed to the shareholders of the company, the auditors give their opinion on the attached financial statements. The auditors also opine on the companies’ internal controls over the financial reporting. In writing the report, auditors typically follow a standard format.

You can easily use Calcbench’s disclosure query to search the auditor’s reports and identify companies for which the auditor found some issues. For example, choosing the S&P 500 companies in 2016, and searching for the text “did not maintain” would identify 5 companies (ALXN, BLL, CTSH, EBAY, ZBH) in which auditors that found the firm ‘did not maintain’ appropriate controls over the financial reporting.

Some auditors use different text, so you may want to look at “expressed an adverse opinion” or “adverse opinion”. This would produce some more companies (see below).

The auditor’s report includes a treasure trove of information. At Calcbench, we extract some information out of it and offer it to our users. For example, you can use the multi-company viewer to uncover the auditor (variable name: auditor_name) for companies you are interested in. And new this year, you can see how long they have been auditing the company, also known as the auditor tenure (variable name: auditor_since_year).

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