Skip to Main Content
The Portable MBA in Finance and Accounting, 4th Edition
book

The Portable MBA in Finance and Accounting, 4th Edition

by Theodore Grossman, John Leslie Livingstone
October 2009
Beginner content levelBeginner
624 pages
21h 25m
English
Wiley
Content preview from The Portable MBA in Finance and Accounting, 4th Edition
3
Analyzing Business Earnings
Virginia Earll Soybel
 
 
 
More than a decade ago, a special committee of the American Institute of Certified Public Accountants (AICPA) concluded the following about earnings and user needs:
Users want information about the portion of a company’s reported earnings that is stable or recurring and that provides a basis for estimating sustainable earnings.1
While users may want information about the stable or recurring portion of a company’s earnings, firms remain under no obligation to provide this earnings series. However, there are generally accepted accounting principles (GAAP) requirements for separate disclosure of selected nonrecurring revenues, gains, expenses, and losses on the face of the income statement or in notes to the financial statements. Further, the Securities and Exchange Commission (SEC) requires the disclosure of material nonrecurring items.
The prominence given the demand by users for information on nonrecurring items in the AICPA report is, no doubt, driven in part by the explosive growth in nonrecurring items over the past two decades. The acceleration of change, together with a passion for rightsizing and cyclical needs for downsizing, has fueled this growth. The issuance by the Financial Accounting Standards Board (FASB) of a number of new accounting statements, which require recognition of previously unrecorded expenses and more timely recognition of declines in asset values, has also contributed to the increase in nonrecurring ...
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Start your free trial

You might also like

Finance and Accounting for NonFinancial Managers, 3rd Edition

Finance and Accounting for NonFinancial Managers, 3rd Edition

Eliot H. Sherman
Corporate Finance, 5th Edition

Corporate Finance, 5th Edition

Pierre Vernimmen, Pascal Quiry, Maurizio Dallocchio, Yann Le Fur, Antonio Salvi

Publisher Resources

ISBN: 9780470526323Purchase book