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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (25013)	1/28/2002 6:26:37 PM
From: kanuti	Read Replies (1) \| Respond to of 99280

Looks to me like there is more and more truth to this comment: Outgoing SEC Chief Economist Lynn Turner says pro forma earnings are effectively "EBS" earnings--"Everything but the Bad Stuff."

To: Zeev Hed who wrote (25013)	1/28/2002 6:42:48 PM
From: sylvester80	Respond to of 99280

amortization and impairment of goodwill and intangible assets, stock compensation and warrant expense, in-process research & development expense, patent defense costs, restructuring costs and acquisition integration costs. If in doubt, simply look at the change in stockholders equity 9and subtract new equity sold, of course). In that case, in the last year, stockholders equity declined by $16 MM. LMAO. Is that for real?

To: Zeev Hed who wrote (25013)	1/28/2002 6:59:03 PM
From: mishedlo	Read Replies (1) \| Respond to of 99280

GX Sales Accelerating! says the headline GX Goes bankrupt in the fine print biz.yahoo.com LOL This kind of reporting is disgusting Really no different than the proforma BS we are subjected to M

To: Zeev Hed who wrote (25013)	1/28/2002 6:59:46 PM
From: mishedlo	Read Replies (1) \| Respond to of 99280

From EXPE Yahoo board: messages.yahoo.com.

To: Zeev Hed who wrote (25013)	1/28/2002 10:16:13 PM
From: retiredcfo	Read Replies (1) \| Respond to of 99280

Zeev: Looks like the SIMG disclosure was OK - not what I would like to see - but OK - I went back and read it: your quote is right - net loss INCLUDES all that bad stuff. They are calling attention to it in the hopes that investors will conclude that it is a list of one time, non-cash bad stuff that really isn't related to the economics of the business, and therefore go back to looking at the pro forma numbers they present without all that stuff. As opposed to some of the dreadful reporting we've all seen lately, they at least put the net loss in the release where you can find it. As a long time bean counter, here is my two cents: Pro forma disclosures should be limited to acquisitions/dispositions and other events that materially alter shares outstanding (e.g. converts, pfds). However, traders must pay close attention to the pro forma numbers because they still move the markets. Investors, IMO, should always dig until they find they find old fashioned net income/(loss) and compare it to the prior year period. I particularly object to removing depreciation from the equation - those assets didn't get on the balance sheet by magic - real shareholder cash was most likely spent to buy them and the shareholders should expect a return, not a pro forma return. (As an aside, some companies do have a legitimate complaint about stock based compensation expense: the SEC took a really tough stance in 99-00 for IPO's about the value of options issued to insiders, and in many cases forced companies to record options as compensation expense. That expense is still hitting income even though the options may well be irretrievably below water.) Lastly, use some care in using net equity change: it is a very good test, but for multinationals some currency gain or loss can muddy the water. gm