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Gold/Mining/Energy : Inmet Mining.$$$$$$$$$$$ -- Ignore unavailable to you. Want to Upgrade?

To: JUNIORSPECULATOR who wrote (10)	1/23/2002 7:03:45 AM
From: tyc:>	Read Replies (1) \| Respond to of 42

>>How the hell does one figure out real value as opposed to BS ? That's a great question. Let me have a stab at the answer ! (Leave dividends out of it as irrelevant to this discussion) If shareholder equity on the balance sheet increases, the company has made a real profit. The profit is the amount by which shareholder equity has increased. Anything that increases shareholder equity is real profit. In the case of Inmet, this will include the $15,000,000 reclamation liability that is no longer a liability because it is not needed. It is not an "operating" profit, but it is a profit simply because its write-off has improved shareholder equity. In "proforma" accounting, the "shareholder equity" can actually decline while the company still claims to have "made a profit". Usually shareholder equity declines because of routine write-offs of "assets" .... items that they purchased in the past that do not have the stated value. This is the opposite of the write off of liabilities. They say "this isn't really an expense because it doesn't involve cash". But they DID show it as an asset and therefore it WAS included in shareholder equity.... shareholder equity has declined and therefore they have NOT made the profit they claim. The write-off of assets is a loss item, just as the write-off of liabilities is a profit item. Look close at the assets on the balance sheet. Are they real and fairly valued there ? I'm no accountant ! Anyone care to agree or to disagree ?