I sometimes wonder whether the highly intelligent people who set accounting standards live on the same planet as me.

As a practising equity analyst, my prime goal is always to get inside the accounts of a company and understand what is really going on. One of the best ways to do this, in theory, is to analyse the cash flow. Balance sheets are important but tell you nothing about flows. Income statements are all about flows but are based on lots of estimates and do not provide a complete picture of the health of a company.