The Art of Earnings Manipulation

Companies don't just report earnings. They sculpt them. Most financial statements you see aren't pure

accounting. They're carefully edited stories designed to look better than reality.

GAAP gives us rigid, standardized rules for financial reporting. But executives hate GAAP because it

makes their profits look smaller and messier than they want. So they invented

non-GAAP metrics, which let them exclude anything inconvenient. The playbook is predictable.

Buy back stock to inflate earnings per share. Strip out real recurring expenses from EBITDA.

Shuffle costs between quarters to smooth the bumps. The wildest part? Analysts play along.

They need access to executives for research and interviews, so challenging sketchy accounting means