Resulting UAFRS-based earnings, assets, debts, cash flows from operations, investing, and financing, and other key elements become the basis for more reliable financial statement analysis.
Thereby, business performance, equity valuation analysis, and credit analysis under UAFRS-reported numbers begin to provide significant improvement over any analysis driven by as-reported numbers.
A growing base of research is now showing the proof behind UAFRS-based analysis.
UAFRS-based credit analytics appear to consistently provide an early signal on the credit worthiness and riskiness of corporate debts.
In a plethora of case examples and larger studies, UAFRS-based equity analysis is showing an ability to better classify firms as “cheap” versus “expensive,” or as low quality versus high quality vis a vis analysis such as economic profit.
Even simple business performance analyses seem to benefit from the fewer distortions, analyses such as the DuPont method for analyzing margins and turns as the drivers of return on assets.
Some of the most compelling evidence has been in aggregate analysis, when looking at entire stock markets of USA, China, Germany, Singapore, and others. There is a clear relationship between market valuations and UAFRS earnings that does not at all exist between valuations and as-reported earnings.
I hope this site will become a resource for better understanding and applying UAFRS for financial statement analysts of every background and purpose.