Donald W. Reynolds National Center For Business Journalism

Two Minute Tips

Beginner’s guide to 10-Q

May 15, 2017

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Reading a 10-Q calls for patience—and a highlighter. ("Pens at Work" image by "Jenny" via Flickr, CC BY 2.0)
Reading a 10-Q calls for patience—and a highlighter. ("Pens at Work" image by "Jenny" via Flickr, CC BY 2.0)

Like all corporate filings, the 10-Q tends to present company information in the best light possible. It is written by accountants and lawyers, which means it is full of confusing sentences and legalese. Here’s how to break it apart.

You’ll need a printer, a highlighter and a pencil.

Print out the report and tackle the section you’re focusing on sentence by sentence. Change the jargon into plain English. If dates are jumbled (not uncommon when a company is presenting bad news), create a simple timeline. If the text mentions another filing, make a note to check it out later. If you run into a bunch of numbers, do the math.

Most of what’s in a 10-Q is decipherable by a reasonably smart person with a good command of English. But if the language gets too technical and the concepts too unfamiliar, ask for help. Seek out an expert in the company’s field.

If you’re looking for news

If the 10-Q just came out and your goal is to spot any news that’s in there, skim. Understand in advance how the company organizes its quarterly reports, and zero in on the most significant sections. Also take a look at sections relevant to any ongoing stories. That means the legal proceedings for a company facing lawsuits, or the Mine Safety Disclosure for a natural-resources company that’s struggling with workplace deaths.

If you’re looking for something specific

A 10-Q is mostly one long document. Some companies include tables of contents that link to key sections and can help you home in on the specific information you need. But don’t let the company control your search of its documents. If you’re looking for something specific, control-F is your friend (or command-F on a Mac).

If you want to get to know a company

If you really just want to get to know a company better, don’t rush. Read through sections of the 10-Q over time, taking a break to do something else in between, so your eyes don’t glaze over. Ideally, you’ll want to read the 10-Q with the most recent previous 10-Q on hand, as well as the 10-Q from the same quarter a year ago, so you can see how things have changed year-to-year. Being able to reference the company’s most recent 10-K will give you a larger perspective.

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