NO.PZ2024101001000068
问题如下:
Question An analyst gathers the following information about a company (in € millions):
When adjusting financial statements to analyze the performance of core operations, the best practice is to use a profit before taxes (in € millions) of:
选项:
A.A.26. B.B.38. C.C.88.解释:
Solution-
Correct because unlike the core operations and resources, the returns earned by associates are not under the direct control of management. To avoid making incorrect inferences about the profitability of operations, the analyst wants to remove the effects of the investments in associates from the balance sheet and income statement. In this case, the best measure of performance of operations is determined by adjusting the profit before taxes with the income from associates and joint ventures = Profit before taxes – Income from associates and joint ventures = 76 – 50 = 26 (also equal to the Profit before taxes, associates, and joint ventures).
-
Incorrect because it deducts the Income from associates and joint ventures but also adds back to the profit before taxes the recurring unusual charges = Profit before taxes – Income from associates and joint ventures + Recurring unusual charges contained within operating profit = 76 – 50 + 12 = 38.
Instead, when analyzing performance, the profit margins include all the previously identified unusual charges because the analyst believes that they should not be excluded. They are real costs of doing business and seem to recur; they were actually incurred by the managers, who should be accountable for their stewardship of the shareholders’ resources.
-
Incorrect because it does not deduct the Income from associates and joint ventures but adds back to the profit before taxes the recurring unusual charges = Profit before taxes + Recurring unusual charges contained within operating profit = 76 + 12 = 88.
- identify financial reporting choices and biases that affect the quality and comparability of companies’ financial statements and explain how such biases may affect financial decisions
为什么只减去了联营合营的费用?