I never took accounting 101 please help!

April 7, 2011 1:24 PM

Basic accounting text? I'm an attorney and recently a lot of my job involves ferreting out a defendant's financials, balance sheets, and cash flow statements. I've never taken accounting and my knowledge is very limited. I'd like to get some kind of basic accounting text (or other source) to just kind of help me better understand what I'm looking at and also ask informed questions of CFOs and accountants and the like. I work in a very small firm, so we (and our clients) don't really have money for expensive experts and I've got to do a lot of this leg work on my own. Thanks for your help. I'm looking for something that just explains the basics of balance sheets, cash flow statements, and financials etc.
posted by bananafish to Work & Money (11 answers total)

This is actually a class you can take in law school.
posted by valkyryn at 1:26 PM on April 7, 2011 [1 favorite]

It doesn't sound like you need an accounting text so much as you need a basic financial statement analysis text. I'd look and see what the CFA folks are using for the exam these days and pick that up.
posted by JPD at 2:00 PM on April 7, 2011

Keeping the Books is a good basic roadmap books from the perspective of a small business owner. It would be useful to you for its description of financial statements, what they say and why they are useful. It is short and to the point.
posted by readery at 2:13 PM on April 7, 2011

I recommend Horngren's Financial Accounting.

I would actually see if you can audit a financial accounting class. If you're near a university, these are in ever undergrad or MBA program. The material isn't hard at all, but you want to make sure you're understanding the concepts correctly. There's a bit of nuance to it, and if you don't have a solid foundation, I could see easily missing important things you'd otherwise skip over because they seem obvious.
posted by geoff. at 2:14 PM on April 7, 2011

Yes, the CFA Institute's financial accounting textbook is what you want. Specifically you want the textbook for their Level I curriculum.

Cfainstitute.org
posted by dfriedman at 2:16 PM on April 7, 2011

I feel like an actual accounting class might be more than you need, based on your question. I highly recommend Analytical Methods for Lawyers, which has chapters that discuss the topics you are looking for in a manner that is something more than the view from 10,000 feet, but not so finely detailed as an accounting class. I would start here and see if this is all you need.
posted by gauche at 2:29 PM on April 7, 2011

Law librarian here. Try West's Accounting and Finance for Lawyers in a Nutshell and/or PLI's Basics of Accounting for Lawyers
posted by banjo_and_the_pork at 2:57 PM on April 7, 2011

I have Horngren/Harrison/Bamber's Accounting right here in my house - it's probably cheaper for you to get it on Amazon than for me to ship mine to you, however. It's a decent enough text, easy to decipher - i took an online 8-credit Acc 101 & 102 with it.
posted by kpht at 7:42 PM on April 7, 2011

I'm in a similar boat as you (small firm, doing budgets and reading financials for the first time, etc.)...I've been working my way through

http://www.amazon.com/Finance-Non-Financial-Managers-Briefcase-Books/dp/0071413774

(it has worksheets and quizzes at the end of each chapter). Seems good so far and has brought me up to speed on a lot of vocabulary.
posted by Tandem Affinity at 9:03 PM on April 7, 2011

With all due respect...I realize there's a certain amount of "I'm a lawyer, so any lesser profession should be something I can pick up along the way", but accounting, and in particular forensic accounting, are not trivial topics one is going to pick up adequately by reading a book. Certainly not adequately to deal effectively with a CFO worth their salt. Perhaps you should consider referring clients in this situation to a firm that actually has expertise in this area, rather than retaining experts yourself. Do you take clients with health care claims and say "I'm not a doctor, and never had biology, but give me a book to read and I'll give you some bang-up representation"?
posted by kjs3 at 9:06 PM on April 7, 2011 [1 favorite]

i understand your point kjs3, especially in light of how my husband is on his way to a cpa. there is no way that the book I suggest can ever bring me close to what he learned in his first six months of classes, and the CFO is always the best reference. on the other hand, those of us with no formal training in accounting usually do need some help to be able to discern what we don't even understand about financial documents, etc. and how to ask the questions to understand what we don't. i think that's what bananafish is asking. it's too bad that some fields do not provide trainees with the basic accounting framework that any person in business should probably get, but at least we can try to bring ourselves up to a functional level.
posted by Tandem Affinity at 9:58 AM on April 8, 2011