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To: Mike M2 who wrote (14667)	2/8/2002 9:55:02 PM
From: AC Flyer	Read Replies (3) \| Respond to of 74559

I thought so. You don't have a clue. The situation in 1929, with no broadly accepted accounting standards, is lightyears away from what we have now. I won't ask you to explain pro forma accounting, because I know you can't. You've just latched onto it as a bugaboo like all the other goldbug/depression superbears. So let me explain pro forma accounting for you. First of all, pro forma is a Latin phrase meaning "for shape." It has come to have a somewhat different meaning in business. A "pro forma" financial statement is one which resembles the actual statement but is different in some meaningful way. It may be a preliminary version of the final document, as in "pro forma invoice" or it may be a document which differs from the actual document in ways which are explained in footnotes or in accompanying documentation, like, for example, a "pro forma income statement." So, pro forma financial reporting is nothing more than financial reporting which differs from the actual (in this case GAAP) financial report in certain ways that are ALWAYS EXPLAINED. During the recent period when pro forma financial reporting came to be widely used, it DID NOT REPLACE GAAP FINANCIAL REPORTING. All public companies are required to file various documents with the SEC, and make those documents public, that show the actual performance of the company in GAAP terms. However, many companies used pro forma financial statements, IN ADDITION TO THEIR GAAP FINANCIAL STATEMENTS, that show their operating performance after certain adjustments. These adjustments are typically used to remove the effect of occurrences that companies deem are one-time occurrences (e.g. costs associated with acquisitions, costs associated with layoffs, etc.) and thus can reasonably be argued not to present a true picture of the company's financial performance on an ongoing basis. The problem with pro forma earnings reporting arose because companies became too aggressive, typically by broadening the categories of expenses that were deemed to be non-operating expenses and thus were backed-out of the pro forma income statement. NEVRTHELESS, GAAP FINANCIAL REPORTS WERE ALWAYS AVAILABLE TO ANYONE WITH THE INTELLIGENCE TO CLICK A MOUSE POINTER ON EDGAR. (http://www.sec.gov/edgar.shtml) The only people fooled by pro forma accounting were those who never read more than a press release before making an investment decision. So, your statement, >>companies reported earnings how they liked" sounds like pro forma<< is pure, unadulterated, ignorant nonsense.