If in reading a company’s financial reports it doesn’t make any sense to you, then avoid the company all together, Warren Buffett advises.
“I would say that when the accounting confuses you, I would just tend to forget about it as a company,” Warren Buffett said at the 1995 Berkshire Hathaway Annual Meeting. “We have never had any great investment results from companies whose accounting we regarded as suspect. I can’t think of a one.”
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© 2022 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.