Hmmmm.... IBM, GE, and MSFT earnings overstated by over $2B?
DuPont over $4B? Apple, the Gap overstated bigtime as well?
*****
"It finds that corporations have been boosting their numbers by including income from their pension funds, adding back charges made when buying companies and not allowing for the cost of share option plans.
When these changes are taken into account, some of the big profits declared by US giants virtually disappear.
For example, the $4.33bn of earnings declared by chemical group Dupont in 2001 fall to a loss of $49m under S&P's calculation – a difference of $4.38bn. IBM's 2001 profits are down $2.87bn, Microsoft's $2.26bn lower, and the $1.01bn loss made by internet giant Cisco soars to $2.52bn.
General Electric, the largest corporation in the world, is found to be a consistent offender. In 2001 it overstated its earnings by $2.23 bn, in 2000 by $1.93bn, in 1999 by $1.43bn, and in 1998 by $1.01bn.
Among smaller but well-known names, the inflation of profits is also prevalent. The Gap, Apple and Yahoo! are all cited as companies where "core earnings" are a fraction of those reported to the markets."
news.independent.co.uk |
