The hottest Accounting Substack posts right now

And their main takeaways
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Top Finance Topics

The Bear Cave #311

The Bear Cave • 1352 implied HN points • 01 Feb 26
💰 Finance Accounting
  1. Multiple activist and short-seller reports allege accounting problems, sanction breaches, and misleading partnerships at a number of public companies, driving fresh scrutiny of firms like Ubiquiti, Richtech, and Carvana.
  2. There’s notable executive turnover, especially sudden CFO departures and terminations, which could point to governance or financial-control issues at affected companies.
  3. Regulators, the press, and research groups are increasingly calling out fraud, disclosure failures, and suspected pump-and-dump activity, underscoring heightened market and legal risks for investors.

The Startup CFO

Points And Figures • 426 implied HN points • 12 Feb 26
💼 Business Accounting
  1. In the very early days founders handle finance with simple tools like QuickBooks and often hire fractional CFOs to standardize books rather than making a full-time hire.
  2. Startups should prioritize product, engineering, and sales to find product‑market fit because finance is rarely a growth engine in the early stages.
  3. Around $10M ARR you need an in‑house CFO to professionalize finance for fundraising or an IPO; seasoned CFOs bring networks and roadshow experience, and a self‑styled ‘CFO’ at Series A or earlier is a red flag.

Enablers

QTR’s Fringe Finance • 64 implied HN points • 22 Feb 26
💰 Finance Accounting
  1. Complex related‑party and off‑balance‑sheet transactions can make a company look profitable while the real losses are hidden elsewhere, masking its true financial health.
  2. Financial media and sell‑side analysts often accept surface answers because they rely on access and relationships, so they frequently fail to ask the follow‑up questions that would expose the substance behind the numbers.
  3. Retail investors end up paying the price for that selective incuriosity, so accounting, auditing, and journalism need more relentless, adversarial scrutiny — if the numbers are honest they will hold up, and if not investors will be harmed.

Hovnanian 2025 Details

Erdmann Housing Tracker • 84 implied HN points • 26 Jan 26
💰 Finance Accounting
  1. The piece discusses key details from Hovnanian's 2025 10-K annual report.
  2. It builds on a prior analysis of the company's 2025 fourth-quarter results.
  3. Much of the deeper analysis is behind a paywall, though some content is available for free and readers can subscribe to read the full post.
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Building An Empire

Compounding Quality • 982 implied HN points • 03 Feb 24
💼 Business Accounting
  1. Kelly Partners Group is a professional services firm offering accounting and consulting services.
  2. The company aims to emulate 'The Berkshire Hathaway of Accounting' through strategic acquisitions.
  3. Kelly Partners Group showcased great financial results and expansion, including a move into the United States.

Fraud in Asia

Asian Century Stocks • 668 implied HN points • 24 Jan 24
💰 Finance Accounting
  1. Tan & Robinson's book on Asian financial statement analysis is a key resource for spotting fraud and misrepresentation in Asia.
  2. Watch out for companies with high margins, poor cash flows, fast-growing balance sheets, and complex corporate structures with frequent related party transactions.
  3. High-profile short-seller reports should be taken seriously when assessing potential fraud in companies.

Secular vs Cyclical: Why it’s hard to tell in real time, and what the EV write-down wave reveals

Gad’s Newsletter • 20 implied HN points • 16 Feb 26
💼 Business Accounting
  1. It’s very difficult to tell in real time if a change is secular or cyclical because data are noisy, trend-cycle methods are model-dependent, and endpoint uncertainty makes conclusions fragile.
  2. The EV episode shows the direction is likely secular (battery costs and adoption tend to rise) but the speed is cyclical and policy-sensitive, and treating near-term pace as linear led to huge write-downs and competitive losses.
  3. The practical fix is disciplined triangulation and decision design: separate direction from speed, check cross-sections and policy regimes, treat impairments as stress tests, and prefer staged, flexible investments that preserve optionality.

Is EBITDA Really Bullshit? Answer: "It Depends"

Value Investing Substack • 353 implied HN points • 05 Aug 23
💰 Finance Accounting
  1. EBITDA can be a controversial metric in finance, with some calling it 'bullshit earnings'.
  2. John Malone successfully used EBITDA to communicate TCI's growth strategy in cable industry.
  3. Valeant Pharmaceuticals' misuse of EBITDA led to financial trouble, highlighting the importance of understanding the context behind EBITDA figures.

Facebook (Meta) Lesson 2: Accounting Inconsistencies and Consequences

Musings on Markets • 619 implied HN points • 10 Nov 22
💼 Business Accounting
  1. Accounting mistakes can misclassify expenses, affecting a company's reported profits and overall valuation. When money is wrongly categorized, it can look like a company is performing worse than it actually is.
  2. Correctly categorizing expenses like R&D can show a company’s true financial health. For example, treating R&D as a capital expense can increase reported profits and the value of the company.
  3. Understanding these accounting practices is important for investors. If investors misjudge a company due to these accounting errors, it may lead to undervaluation, making the company look cheaper than it really is.

Why Does Bank Accounting Seem So Backwards?

Without Warning • 196 implied HN points • 06 Jun 23
💰 Finance Accounting
  1. Understanding the business is more important than fixing the accounting in banking.
  2. Marking bank assets to market interest rates may not make sense due to unique aspects of bank deposits.
  3. Bank accounting rules may not accurately reflect the reality of different banking business models and can lead to economic distortions.

How to Analyze an Income Statement

Concepts of Finance 🧠 • 219 implied HN points • 06 Jul 23
💰 Finance Accounting
  1. An income statement shows how well a company is doing by detailing its revenue, expenses, and net income over a period. It's important because it helps you understand if a company is making a profit or losing money.
  2. Gross profit margin is a key metric to analyze. It reveals whether the company is profitable on the products it sells, and a stable or rising margin is a good sign.
  3. When reading an income statement, look for trends over time, check revenue directions, and ensure expense categories make sense. This can highlight the company's overall health and performance.

Accounting Shenanigans (SMRT-US)

Guasty Winds Investment Ideas • 137 implied HN points • 12 May 23
💰 Finance Accounting
  1. Revenue growth at SmartRent was driven by accounting changes, not real business growth.
  2. The increase in revenue and adjusted EBITDA is due to accounting tricks and does not impact cash earnings.
  3. Professional services revenue showed little improvement, indicating the company's challenges in profitability.

Does the rise of index funds make managers myopic?

Klement on Investing • 2 implied HN points • 10 Feb 26
💰 Finance Accounting
  1. Managers facing frequent quarterly guidance often favor strategies that smooth short-term earnings, even when those choices reduce long-term value.
  2. High index fund ownership tends to increase short-term decision making, but mainly at firms that already give frequent earnings guidance, because managers then aim for predictable results.
  3. The key issue is fewer long-term shareholders and the incentive to stay in indexes, so it’s the combination of ownership composition and guidance habits — not index funds alone — that drives myopic behavior.

So-Fried

The Last Bear Standing • 72 implied HN points • 22 May 25
💰 Finance Accounting
  1. SoFi has changed from focusing on high-quality student loans to riskier personal loans and credit card consolidations. This shift has put the company in a tougher spot than before.
  2. The way SoFi accounts for its loans is unusual compared to other banks, which can create a false sense of financial strength. This method allows them to report higher earnings but exposes them to more risk.
  3. As a bank, SoFi must follow strict regulations that weren't a concern when they were just a tech company. If they don't manage their finances carefully, they could face serious consequences from regulators.

Learning from the mafia

Klement on Investing • 3 implied HN points • 23 Jan 26
💼 Business Accounting
  1. Mafia-connected firms and their accountants push effective tax rates down — clean firms in heavily infiltrated regions pay about 1% less tax on average and are 3.6% more likely to restate their tax filings.
  2. This spreads because firms share the same accountants, accounting firms reuse tricks learned from mafia clients, and honest firms feel pressured to copy aggressive tax strategies to stay competitive.
  3. The net effect is a strong incentive for many companies to cut their tax bills aggressively, which ends up costing the state a lot of money.

Intellectual Laziness

MD&A • 404 implied HN points • 04 Jul 23
💼 Business Accounting
  1. Intellectual laziness can lead to catastrophic corporate failures, as seen in the case of GE and SVB.
  2. Managers who prioritize manipulating short-term earnings over creating long-term shareholder value are intellectually lazy.
  3. Intellectual rigor is essential in identifying underrated managers and avoiding overrated ones.

Which profits matter most?

Klement on Investing • 2 implied HN points • 13 Jan 26
💰 Finance Accounting
  1. Operating profit (EBIT) is the main profit measure that moves share prices. Institutional investors also check net income to capture interest and other real costs.
  2. Gross profit or EBITDA is often presented as ‘profits before the bad stuff’ and can be misleading. Be wary of adjusted profit numbers that deviate from accounting standards.
  3. Which metric matters most depends on the market. In the US investors focus on profitability, while in the UK and Europe they pay more attention to past and future earnings growth because growth is scarcer there.

The fourth quarter effect in small caps

Klement on Investing • 2 implied HN points • 07 Jan 26
💰 Finance Accounting
  1. Smaller companies show a clear drop in earnings in their fourth fiscal quarter, with the effect strongest among the smallest 25–50% of firms.
  2. The decline is driven mainly by sudden rises in costs (COGS and SG&A) and outdated cost forecasting or weak internal systems, not by lower sales or audit-driven manipulation.
  3. Analysts usually don’t adjust for this Q4 effect, so misses are more common, but market reactions are muted since investors tend to focus on the coming fiscal year.

Daily Brief: Income Statements & Heat Engines

Math Meets Money • 1 HN point • 20 Aug 24
💼 Business Accounting
  1. Every business operates on a basic principle: income equals revenue minus costs. This is like a simple equation that explains how money flows in and out.
  2. A business can be thought of as a heat engine where revenue is the input, total costs are the output, and net income is the useful energy left over to be used by the company.
  3. Businesses help organize and order capital, just like heat engines organize particles. Understanding these similarities can make it easier to grasp how businesses function.

We don’t want auditors to be good at their job

Klement on Investing • 2 implied HN points • 11 Dec 25
💰 Finance Accounting
  1. Corporate accounting scandals recur and auditors are routinely made the public scapegoat, prompting regulatory fixes that don’t stop the next failure.
  2. If auditors actually caught all fraud, investors who lose money would still look for someone else to blame, because many people outsource their own due diligence.
  3. The blame cycle usually expands to regulators and then quiets after reforms, allowing auditors and the system to be gradually exonerated and the pattern to repeat.

Illumina: Icahn's Gambit

Nongaap Investing • 50 implied HN points • 08 May 23
💼 Business Accounting
  1. Illumina's response to a blogger's questions might lead to resignations in the company.
  2. Addressing unanswered issues could influence significant governance matters at Illumina.
  3. Investors should pay attention to unaccounted shares, financial dealings, and potential conflicts within Illumina and Grail.

Illumina: Fraud by Omission

Nongaap Investing • 32 implied HN points • 18 May 23
💼 Business Accounting
  1. Fraud by omission is a significant concern in the case of Illumina insiders and their financial windfall on Grail.
  2. By omitting material facts, Illumina insiders potentially misled investors and reaped undisclosed financial windfalls.
  3. The use of cost method accounting instead of equity method accounting may be seen as a form of fraud by omission, allowing for undisclosed financial benefits.

[P] BL: Accounting for Henshall

Nongaap Investing • 5 implied HN points • 14 Dec 24
💼 Business Accounting
  1. BlackLine has a new director known for his skill in mergers and acquisitions. People are curious if he can help the company grow through strategic takeouts.
  2. Nongaap investing focuses on understanding the true value of companies beyond just their financial reports. This approach can give investors a better idea of potential investments.
  3. The content shared is meant for paid subscribers, indicating a focus on delivering exclusive and premium insights.

Triggered Disclosures: Escaping the Disclosure Dilemma

Musings on Markets • 19 implied HN points • 19 Oct 21
💼 Business Accounting
  1. Corporate disclosures have become very long and confusing, making it hard for investors to find important information. This complexity can confuse rather than inform potential investors.
  2. Instead of having a one-size-fits-all approach, disclosure rules should be tailored to fit the unique needs of different companies. This would help make disclosures clearer and more useful.
  3. The definition of materiality needs to change from focusing on past earnings to considering how information affects future company value. This would encourage companies to provide information that truly matters to investors.

Issue #89: Mastercard Makes Moves In China, Wise Posts A Healthy H1 Result, And Adyen Launches A New Product In Australia

Fintech Radar • 6 implied HN points • 22 Nov 23
💰 Finance Accounting
  1. Wise reported impressive financial results for H1 2023 with quadrupled pre-tax profits, showing success in expanding beyond peer-to-peer money exchange.
  2. Adyen launched Capital in Australia, recognizing the growing demand for embedded financial services in platform businesses.
  3. Mastercard received approval for bankcard clearing in China, a big step to settle transactions directly and establish presence in the Chinese market.

Stock-based Employee Compensation: Value and Pricing Effects

Musings on Markets • 19 implied HN points • 13 Feb 14
💰 Finance Accounting
  1. Stock-based compensation is an expense that affects a company's earnings. It should be counted and not ignored because it represents a real cost to the business.
  2. Adjusting financial metrics like profits to remove stock-based compensation can be misleading. It can make a company look more profitable than it really is, especially when comparing with others that don’t do the same.
  3. The way companies handle stock-based compensation can impact their valuation. Analysts need to account for this properly to get an accurate picture of a company's worth.

Acquisition Accounting I: Accretive (Dilutive) Deals can be bad (good) deals

Musings on Markets • 0 implied HN points • 08 Dec 12
💼 Business Accounting
  1. Accretive deals are not always good; it depends on the earnings and risks of the companies involved. Just because a deal raises earnings per share doesn't mean it will help the stock price.
  2. Dilutive deals can also be beneficial if the acquired company has better growth potential or lower risk. Sometimes, risks from a lower-quality target company can hurt the combined firm's value.
  3. Market reactions to accretive and dilutive deals don't always align with assumptions. The market may not reward or punish these deals in the expected way, making the traditional analysis less useful.

Acquisition Accounting II: Goodwill, more plug than asset

Musings on Markets • 0 implied HN points • 17 Dec 12
💰 Finance Accounting
  1. Goodwill on balance sheets can confuse investors because it doesn't really represent an actual asset. It basically acts as a placeholder that can mix a lot of different values together.
  2. Changes in accounting rules made it harder to compare companies that do acquisitions with those that grow internally. This makes it tricky for investors to understand a company's real value.
  3. Impairments of goodwill can impact stock prices, but they also create more confusion in financial reports. This could mean that investors are often surprised by these impairments long after the acquisition.

My Valuation Class: The Fall 2015 Model Preview

Musings on Markets • 0 implied HN points • 24 Aug 15
🚌 Education Accounting
  1. Valuation is a skill, not just numbers or theory. It's like cooking or building things, where you get better by doing it rather than just studying the details.
  2. There's a big difference between valuing an asset and pricing it. Valuation looks deeper into the intrinsic value, while pricing is often about what the market will pay.
  3. You can value almost any asset, even if it seems tricky. By the end of a valuation class, you'll have the tools to value different types of assets confidently.

Baseball and Carbon Accounting, Part 1

Solar Powered Data • 0 implied HN points • 21 Aug 23
🎾 Sports Accounting
  1. Measuring carbon emissions is challenging and involves various frameworks like the GreenHouse Gas Protocol and Science-Based Targets.
  2. Just like baseball teams aim to score more runs by balancing offense and defense, individuals in carbon accounting also strive to reduce emissions while enhancing carbon removal.
  3. In both baseball and carbon accounting, accurately attributing individual contributions is complex, and there is a need for improved methods to credit and analyze performance.

Lightning Network financial statements

bolt.observer • 0 implied HN points • 23 Mar 23
💰 Finance Accounting
  1. Financial reporting provides valuable insights for businesses and helps external stakeholders make informed decisions.
  2. The balance sheet is a key financial statement that reports a company's assets, liabilities, and shareholders' equity at a specific time.
  3. In the Lightning Network, node operations are currently 100% equity-based, but in the future, liabilities such as capital borrowing/lending may emerge.

HP's Deal from Hell: The mark-it-up and write-it-down two-step

Musings on Markets • 0 implied HN points • 26 Nov 12
💼 Business Accounting
  1. HP had a huge loss of $8.8 billion from buying Autonomy, which was a large part of the money they spent. This was mostly due to dishonesty in Autonomy's accounting practices.
  2. The market was really surprised by HP's announcement of the loss, and their stock dropped quickly. Usually, companies' losses from bad deals aren't a shock to investors, but this was a standout case.
  3. Many people involved in the deal are blaming each other for the mess. This highlights the problems in making big mergers and how important it is to have trust in financial reporting.

The Zoom Rooms on a Big News Day

Wide World of News • 0 implied HN points • 10 May 23
🇺🇸 U.S. Politics Accounting
  1. Not all about the verdict, but now a lot about the verdict in Trump's situation.
  2. Liz Cheney firing an opening salvo by attacking Trump's fitness for office.
  3. The biggest variables in White House fiscal talks are the real X date, market reactions, and building trust between key figures.