BALANCE-SHEET-READING5 MIN READ
Sort Balance-Sheet Red Flags from Normal Noise
Separate red flags from context-dependent movements.
Sort Balance-Sheet Red Flags from Normal Noise: place each signal where it belongs. Escalate now Watch with context Often normal Large current debt due in 60 days with no disclosed refinancing Receivables outpace revenue and aging worsens Equity turns negative after recurring losses Inventory rises before a documented peak season PPE rises during a funded plant expansion Deferred revenue rises in annual prepaid subscriptions Cash rises after disclosed equity financing
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