--- title: How to Read a Form 10-K [VIDEO] description: Form 10-Ks contain a wealth of disclosures, but there are three sections that are absolutely key to understanding the company and the progress it is making. image: https://blog.factright.com/hubfs/Blog%20Images/Screen%20Shot%202017-08-15%20at%203.10.15%20PM.png --- behance bloglovin dribbble email facebook flickr github gplus instagram linkedin medium periscope phone pinterest rss snapchat stumbleupon tumblr twitter vimeo xing youtube - [Facebook](https://www.facebook.com/FactRightLLC/) - [Twitter](https://twitter.com/factright) - [Linkedin](http://www.linkedin.com/company/395017?trk=tyah) - [Phone](tel:866-357-7779) [Report Center Login >](http://www.factrightreports.com/Account/Login) - [Home](http://www.factright.com/) - [ABOUT US](http://www.factright.com/team/) - Financial Advisory Firms - [FR Risk Management](http://www.factright.com/fr-risk-management/) - [Report Center](https://www.factright.com/resources/report-center/) - [Product Coverage](https://www.factright.com/resources/list-of-coverage/) - Product Sponsors - [Due Diligence Reporting](http://www.factright.com/due-diligence-reporting/) - [Preparing for FactRight Diligence](https://www.factright.com/preparing-for-factright-diligence/) - [Resources](https://www.factright.com/resources/) - [Report Center](https://www.factright.com/resources/report-center/) - [FactRight Webinars](https://www.factright.com/resources/webinars/) - [FAQs](https://www.factright.com/resources/faqs/) - [Events](https://www.factright.com/events/) - [Weekly Updates](https://www.factright.com/weekly-updates/) - [FactRight Blog](https://blog.factright.com/) - [Contact](http://www.factright.com/contact/) # How to Read a Form 10-K \[VIDEO\] August 15, 2017 by [Jacob Mohs](https://blog.factright.com/author/jacob-mohs) Clients frequently ask us how they can make proper use of the wealth of information available in SEC filings. One of the key filings that we use in our due diligence reviews is a Form 10-K, which contains the annual report filed by companies. These documents contain a wealth of disclosures, but there are three sections that are absolutely key to understanding the company and the progress it is making.  ## Description of the Business and the Strategy In this section, you can understand the background on the business, the strategy it is using, its investment philosophy, as well as the regulatory environment that it operates in.  ## Financial Statements The financial statements section includes the income statement, the balance sheet, and the cash flow statement. We use this information to build our quantitative models and run comparisons across industries. It's not just what the trends are, but also the why behind the trends.  ## Management Discussion and Analysis In this section, management will explain portfolio investment activity and operational trends compared to the prior year. Liquidity and capital resources can also be an important disclosure if the fund has leverage. For BDCs, this section will contain discussions on asset quality and you can also get a hint of problems here before they become headlines.  For [real estate investment](https://blog.factright.com/6-implications-of-rising-interest-rates-on-real-estate-investments) trusts, the reconciliation between GAAP accounting and the FFFO and MFFO can be contained in the Management Discussion & Analysis section.  By focusing on these three key sections, the analyst can turn the illuminious disclosure in a 10-K to a prudent investment decision. 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