An article in the London daily Financial Times on 2 August raises profound questions about balance sheets and profit and loss statements used by investors to value the financial assets they buy. “In the UK in the past three decades,…
Category: Accounting
Fantasy profits
Profit – the difference between costs and revenue – is the engine driving capitalist economies. It determines dividend pay-outs and a high proportion of the market valuation of companies. They can’t survive without it. If there’s no profit, there’s no…
Corporations are measuring the wrong thing
A sweeping criticism of the way companies value themselves and report on their performance is set out in a new report published this month by EY, the international accounting and management consultancy firm. The 39-page Accounting & Reporting for Long-Term…