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To: orkrious who wrote (208291)	12/7/2002 9:14:28 AM
From: 10K a day	Respond to of 436258

> contributing to your pension actual increases future year's operating income. Well golly gee. Ithink we have a new bond offing....Lol

To: orkrious who wrote (208291)	12/7/2002 10:37:48 AM
From: Knighty Tin	Respond to of 436258

ork, expenses are earnings. What's so new about that? The new pair of dimes tells us that is the gospel truth. I'm sure glad the honest Bushwacker administration has closed down accounting gimmicks. <VBG>

To: orkrious who wrote (208291)	12/7/2002 12:51:03 PM
From: mishedlo	Read Replies (2) \| Respond to of 436258

Ork it is pure horseshit and 100% depends on the ASSUMPTION of the rate of return will be what it states. In IBM's case that is 8.5%. With a significant piece in bonds at 4% or whatever they might need 15% return on equities or even more to get 8.5%. The problem is the accounting rule that lets companies assume a rate of return on their earnings whether or not it is achieved. So, by adding cash in the pension fund at an assume rate of 8.5% instead of cash at a real rate of 1%, yes it will help earnings. ON PAPER. The problem comes in down the road when that 8.5% is not achieved. IBM did one even worse because 1/2 that $3B was in IBM stock. What is liklihood IBM stock rises 8.5% next year? M

To: orkrious who wrote (208291)	12/7/2002 6:47:42 PM
From: reaper	Read Replies (2) \| Respond to of 436258

ork, that article is precisely correct see my post from a few days ago... Message 18301653 thanks to the bizareness of pension accounting this is what happens. of course, if you focus on CASH FLOW instead of accrual accounting you realize that IBM is spending $3 billion in CASH to generate a replacement $300mm or so in accrual 'earnings' (i.e. not cash but an accounting entry) and you see it for the scam that it is. but then again since when has IBM been about accounting accurately reflecting the state of the business?? Cheers