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Fitch Ratings issues new report on earnings manipulation

February 10, 2012

The Dow is up.  Unemployment is down.  Corporate earnings are seemingly on the rebound.  As FDR himself would have sung, ‘Happy Days are Here Again’, at least it seems for some.   In line with heightened shareholder expectations, there will naturally come increased pressure to meet key performance metrics and financial ratios.  As a result, certain firms will undoubtedly feel the need to recur to ‘accounting manipulation’ to ‘make their numbers’. In this sense, Accounting Manipulation (Fitch Ratings) – Why, What to Look Out For and How to Adjust was a timely and useful find in this morning’s mailbox.

by Fritz Newman

2 Comments leave one →
  1. February 11, 2012 10:03 am

    Did you ever wonder how company earnings can be within a few cents of Wall Street estimates and Wall Street estimates within a few cents of a companies announced earnings? They can’t even predict the weather with accuracy but earning somehow have a higher accuracy rate. So glad someone actually took the time to write a report on it. It’s like writing a report called “Sun Rises This Morning”. Where or where has all the critical thinking gone?

  2. Kurt Muller permalink
    February 11, 2012 11:09 am

    Hey Fritz, wasn’t it FDR who hired Joseph Kennedy Sr., a well known stock manipulator and inside trader, to serve as the inaugural chairman of the Securities and Exchange Commission? When asked why he had appointed a crook to be the watch dog, FDR replied, “Takes one to catch one.”

    Kurt Muller, standing watch on the Rhine

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