Fantasy Math Is Helping Companies Spin Losses Into Profits

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According to a recent study in The Analyst’s Accounting Observer, 90 percent of companies in the Standard & Poor’s 500-stock index reported non-GAAP results last year, up from 72 percent in 2009.
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Among 380 companies that were in existence both last year and in 2009, the study showed, non-GAAP net income was up 6.6 percent in 2015 compared with the previous year. Under generally accepted accounting principles, net income at the same 380 companies in 2015 actually declined almost 11 percent from 2014.
Another striking fact: Thirty companies in the study generated losses under accounting rules in 2015 but magically produced profits when they did the math their own way.
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“They just need to go do an enforcement case,” Mr. Turner said of the S.E.C. “They are almost creating a culture where it’s better to beg forgiveness than to ask for permission, and that’s always really bad.”

The Tokyo Whale Is Quietly Buying Up Huge Stakes in Japan Inc.

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BOJ is an estimated top 10 owner in about 90% of Nikkei 225