Time for a compliment!

September 5, 2003

Just skimmed through Microsoft’s (MSFT) 10-K which came out earlier this morning and had to give them a compliment. Even though it’s about 20 percent lighter than last year’s K, it’s packed with lots more information. What’s missing? A lot of the extra verbiage that only serves to make the K more difficult for average investors to get through. Somehow they even managed to explain their derivatives contracts — a notoriously difficult footnote — in clear and concise language. That alone deserves an award! Reporting segments — an important item to look at to see where sales are coming from (for more on this see Chapter 9) — have been expanded from three to seven. So for all of those companies that think the answer to better disclosure simply means burying their investors in more pages of fine print, I say turn to Microsoft. Last time I looked, they were a pretty complicated company and if they can come up with a readable K, there’s no reason why others can’t too.

Posted in: Disclosures, Operations

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