Lax enforcement from the SEC has allowed the biggest companies in America -- 90 percent of the companies in the S&P 500, led by the faltering energy sector -- to ignore the "Generally Accepted Accounting Principles" (GAAP) in presenting their financial information to investors, manufacturing nonexistent profits in quarters where they suffer punishing losses.
The result: in 2015, a year in which a representative group of companies saw net their income decline by 6%, they declared gains of 11%. 30 of those companies -- mostly in the energy sector -- turned actual losses into profits on their statements.
There are rules against this kind of "pro-forma" reproting, but the SEC has stopped enforcing them.
Creativity abounds in today’s freewheeling accounting world. And the study found that almost 10 percent of the companies in the S.&P. 500 that used made-up figures took out expenses that fell into a category known as “other.” These include expenses for a data breach (Home Depot), dividends on preferred stock (Frontier Communications) and severance (H&R Block).
But these are actual costs, notes Jack T. Ciesielski, publisher of The Analyst’s Accounting Observer. “Selectively ignoring facts can lead to investor carelessness in evaluating a company’s performance and lead to sloppy investment decisions,” he wrote. More important, he added, when investors ignore costs related to acquisitions or stock-based compensation, they are “giving managers a free pass on their effectiveness in managing all shareholder resources.”
Fantasy Math Is Helping Companies Spin Losses Into Profits
(via Naked Capitalism)
Concealed Online is an anonymously owned (the owner won't divulge his identity due to fear of reprisals) company whose customers complain scammed them by tricking them into taking its online curriculum for Virginia's farcical easy concealed carry permits, without divulging that these permits are useless in the rest of America.
Apple CEO Tim Cook has stated that the free market "is not working" and as a result, regulation of the tech sector is "inevitable."
In March 2018, Nathan Ganas was murdered in his driveway in Durban, South Africa, during a botched hijacking; now Momentum, the insurer who wrote the 2.4m Rand (USD 170,700) policy on his life, is refusing to pay out because they say he didn't disclose his elevated blood-sugar levels when he took out the policy -- […]
The key to learning any new language is feedback. When you’re immersed in conversation, it’s easy to pick up key phrases and pronunciation, but not all of us have the means to jet off to Spain, France or wherever we can learn to speak like a local. The next best thing: The Mondly app. Mondly […]
Got a gadget-minded geek on your holiday list this year? Don’t wait for Black Friday. The prices are already dropping on some quality tech toys, and we’ve got a roundup of some of our favorites. Force Flyers DIY Building Block Drone MSRP: $49.99 | Normally: $42.99 | Price Drop: $39.99 (20% Off) Compatible with everybody’s […]
Ever wondered what it takes to make the transition from amateur photography to a full career? If you answered “a better camera,” you’re half right. Before you get the equipment, get the know-how to use it with the Hollywood Art Institute Photography Course & Certification. Taught by experienced pros, this course is geared towards shutterbugs […]