Can I say: normalized income = net income + additional adjustment (including eliminate non-recurring iterm and adjust to current value or fair value etc.) expended comprehensive income = comprehensive income (GAAP figure) + further adjust which GAAP not required (eg. mark to market gain or lost of held to maturity debts) comprehensive income = net income + other comprehensive income (i.e. the change of accumulative other comprehensive income in the balance sheet) can any one tell, what’s the difference between normalized income and expended comprehensive income indeed and their usage in analysis.
any one can help me?
which ss is it?
synthesis in financial statement analysis
anyone here?
My understanding is that : Comprehensive income is volatile and a poor measure for real earning power of a company because it includes non-recurring items like adjustments for pension, intercompany investment and foreign currency translation. Expanded comprehensive income is better than comprehensive income because it makes some more adjustments, which reflect the economics of the real earing power. However, because Expanded comprehensive income uses comprehensive income as its base for adjustments, it is still a volatile measure. Normalized income is the best measure of the real eraning power and economic of a compnay because it makes all the necessary adjustments to normalize the reported income to reflect a true picture of the company’s earing power.
ok. Thanks a lot
my original question seems still not to be answered…
normalized income and expended comprehensive income new Posted by: oversun (IP Logged) [hide posts from this user] Date: March 18, 2008 11:26PM Can I say: normalized income = net income + additional adjustment (including eliminate non-recurring iterm and adjust to current value or fair value etc.) expended comprehensive income = comprehensive income (GAAP figure) + further adjust which GAAP not required (eg. mark to market gain or lost of held to maturity debts) comprehensive income = net income + other comprehensive income (i.e. the change of accumulative other comprehensive income in the balance sheet) can any one tell, what’s the difference between normalized income and expended comprehensive income indeed and their usage in analysis. I think you are right . that is normalized income = income - nonrecurring items comprehensive income= normalized + changes in equity required by GAAP expanded comprehensive income = normalized + changes in equity required by GAAP + other changes n equity not required by GAAP the difference between normalized income and expended comprehensive would be that you use normalized in evaluating the company (earnings power) because it’s sustainable and use the expanded comprehensive income (overall picture) to better understand the business - that is follow every adjustment and see it’s impact leases, off balance transactions etc. that is my understanding
florinpop thank you again your understanding is very helpful. I agree with you