Detecting Financial Fraud and Trap of Using EBITDA

Detecting Financial Fraud and Trap of Using EBITDA

(May 4, 2002) A shareholder asks Warren #Buffett and Charlie #Munger on their experience in detecting financial fraud. Mr. #Buffett says that he is skeptical with anyone who has an idea that is too good to be truth. In addition, Mr. Buffett was amazes how widespread the use of EBITDA, and he believes that EBITDA is one way to dress up financial statements.

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18 thoughts on “Detecting Financial Fraud and Trap of Using EBITDA

  1. Can you explain anything about how you survived being a Nazi? Same process that destroys nations is buying investors with pyramid schemes of too many investing produces empty material not worth anything. Trillions of dollars will not purchase one atom of hope in space. It is true that some are alright at motivation, yet do not realize their goals are not being predators. Not having long term analysis that you have no more than what is there naked kidnapped at a narco terrorist 'petting zoo'. Name brand are that awful, no man gets rich by ritual association lost in the past of others lost dreams. I have name brand poop for growing swamps into farms. Best guano around, best goat poop in the world worth fortunes. Mexico city was born in swamp. That swamp looks better than folks breeding they way they do. Either way the disease didn't decomp. Some coca cola is that good, other brands do not have coca nor the partial cocaine acetoxy forms. Putting limits on rations is most wise idea not over inflating production of impending doom of production supply logistics not over populating poop addicts. For kids to be their parents is sin hellish nightmares. There is more than genetic depression, social cultural value depression is that obvious trash. Due to workers being told they are trash from generations ago has not saved any royalty, congress, trade nor idea. Work can be trash not persons, that is how good workers find skill making trash into production being swamp growing a flower that is not poison but beautiful. Same as parents are tired of art being type casted, not knew inventions but self identity for social relations. Currency is not much more than that, due to copy cats using time. Cool currency is a long story of hot fires that build a nation. If society out produces by means of consumption production also known as breeding more mouths that do not produce products that achieve different results of invention it's bad day. As every county fair saw every pie every year and every cow is not much different. Good for youth, or those with money buying animals. Yes local auctions for produce is not bad idea even if plant drugs to judge bad grows. Yes live stock auction is difficult down in Amish roads not safe. Going to market is that simple, stupid in industry over world wars. Money is not material, motivation of fake empty material that is only worth history. We got tired of all thinking leadership is money. Same gangster same unoriginal problem. Inflating cities that no longer produce any material other than ghetto. 4 billion coffee break experts all day and night is not a job. System is destined to encourage default choices. Cheap can be the best quality, price jacking is rationing. Which is the correct method yet logistics force purchase. Why pirates always rule the sea. Bottom of barrel society has other motivations that no side works to agree that both sides waste everything about potential due to culture not producing anything much. Everyone wants to own inventions being not original source of mockery.

  2. People are dumb if they are going make a decision based how much a company makes before they have to pay there bills. It’s like someone bragging that they are rich because they make 200,000 a year but by the end of the year they have only saved 5,000 dollars because the other 195,000 went to taxes, mortgage, car payments, boat payments, food, cloths, heating, cooling, water, and of course the useless stuff that you just got to have versus the guy who makes 50,000 a year but only spent 15,000 to live and has 35,000 left at the end of the year, that guy is richer than the 200,000 a year guy.

  3. they are also subjected to fraud in their companies. the question is, does it influence in a big way. they are quite good at avoiding devastating fraud.


  5. This is by far the most organized channel I came across on Warren Buffett and Charlie Munger.

  6. Mr. Buffet is a phenominal individual. I personally have done well by using many of his ideas. I do laugh at so many people feel that there is something magical about investing. It is really not that mysterious. Careful, discipline and patience will win…….most people especially today want it all now. Bitcoin….lol.

  7. Detecting Financial Fraud and Trap of Using EBITDA
    Please comment the following:
    EBITDA is not perfect, but it is a good proxy of capital expenditure.

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