Forensic Alpha

We use proprietary NLP algorithms to perform a forensic analysis of public company filings. We turn unstructured data found in the notes to the accounts and in the governance disclosures into structured data. We process and analyse that data, hunting for the presence of common red flags that are known to be indicators of weak fundamentals, imminent problems and/or, in extreme cases, fraud.  Our clients are mainly asset managers and hedge funds, looking to identify companies that may be at risk.
We are led by a management team comprising three experienced founders: an ex-portfolio manager from a top investment firm, a technology expert with a background in artificial intelligence and a veteran global asset management executive.

Articles

Latest Tweets from @ForensicAlpha

  • Is it a good thing to hit the ground running faster than planned? I'm hoping this sounds better in the German original
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  • A beginner's guide to accounting fraud...a great account from Leo Perry (of Wirecard fame) of how easy it is to perpetrate and how investors usually fail to spot it. ,
  • One of the key red flags on WANdisco was the sharp increase in trade receivables, shown here in an extract from the H1 22 interim report. The number moved from £1m to £12.5m, representing over 200% of sales made over the previous 6 months.
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  • Accounting can get complex when the timing of revenue recognition varies significantly from the billing schedule. We highlight some unusual movements in the disclosure of contract balances within the 10-K for $OLED ,
  • Investors should be particularly alert around capital raising events. Ahead of a DKK 7bn rights issue, GN Store Nord appear to be capitalizing some unusually large costs.
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