Spinning Profits Out of Whole Cloth: What Is That Silk Purse Made Out Of?

Numbers in financial reports differ from reality more often, raising the question of whether investors truly understand the businesses they own.

Source: Fantasy Math Is Helping Companies Spin Losses Into Profits

How can a company turn losses into profits? By excluding some of its costs of doing business. Among the more common expenses that companies remove from their calculations are restructuring and acquisition costs, stock-based compensation and write-downs of impaired assets.

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