Accounting Earnings

The amount of money a company has earned during a given period, usually a quarter or year, as reported based on proper accounting standards. Accounting earnings help to measure a company's profitability, but investors should consider not just earnings quantity, but also earnings quality, in evaluating a company's accounting earnings. Earnings quality considers whether earnings are repeatable, controllable and bankable.

When a publicly traded company announces its accounting earnings, investors' reaction to the news will usually cause the stock's price to move. After releasing the earnings report, the company's management will discuss the results with investors in an earnings call. Generally accepted accounting principles (GAAP) allow accounting earnings to be calculated in a specific manner, while some accounting practices can be selected specifically for their impact on creating accounting earnings that support management goals, which may not always coincide with shareholder goals.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Accounting earnings — Earnings of a firm as reported on its income statement. The New York Times Financial Glossary …   Financial and business terms

  • accounting earnings — earnings of a firm as reported on its income statement. Bloomberg Financial Dictionary …   Financial and business terms

  • earnings — The net income or profit of a business. Because of the importance of earnings in calculating the earnings per share, there has been considerable debate as to its definition. Under Statement of Standard Accounting Practice (SSAP) 6, earnings… …   Accounting dictionary

  • earnings per share — eps The profit in pence attributable to each ordinary share in a company, based on the consolidated profit for the period, after deducting minority interests and preference share dividends. This profit figure is divided by the weighted average… …   Accounting dictionary

  • earnings yield — The ratio of the earnings per share of a company to the market price of the share, expressed as a percentage. See also: price–earnings ratio …   Accounting dictionary

  • earnings retained — See: retained earnings …   Accounting dictionary

  • accounting cushion — In the USA, the practice of making larger provisions for expenses in one year, in order to minimize them in future years. Effectively, earnings will be understated in the present year but will be overstated in a subsequent year …   Accounting dictionary

  • Earnings quality — Earnings quality, in accounting, refers to the overall reasonableness of reported earnings. It is an assessment criterion for how repeatable, controllable and bankable McClure, Ben. (n.d.) Earnings: Quality Means Everything . Retrieved June 29,… …   Wikipedia

  • Accounting scandals — Accounting scandals, or corporate accounting scandals, are political and business scandals which arise with the disclosure of misdeeds by trusted executives of large public corporations. Such misdeeds typically involve complex methods for… …   Wikipedia

  • Earnings before interest, taxes, depreciation and amortization — (EBITDA) is a non GAAP metric that can be used to evaluate a company s profitability.::EBITDA = Operating Revenue – Operating Expenses + Other RevenueIts name comes from the fact that Operating Expenses do not include interest, taxes, or… …   Wikipedia


Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.