Visit cpajournal.com to read the very latest from The CPA Journal
June 2016 » Reimagining the Financial Ratios
Full articles of The CPA Journal are available to NYSSCPA members and CPAJ subscribers ONLY. Please login to access this content.
Nonmembers and nonsubscribers, you can apply for NYSSCPA Membership here and get unlimited access to The CPA Journal, or you can create a non-member online account here and purchase individual articles.
Michael Kraten, PhD, CPA
Last year, in “Reimagining the Financial Statements” (The CPA Journal, April 2015, http://bit.ly/1SSQXz7), this author restated certain fiscal metrics of Apple Inc. to incorporate the value of the company's intangible brand asset. Although such assets are not capitalized under GAAP, the article noted that the recognition of Apple's brand value would result in the transformation of a key financial ratio that would enable analysts to restate an outlier metric to a less statistically extreme value. By applying data transformation techniques to such extreme values, the article concluded that financial analysts could avoid excluding outliers from their portfolio analyses and thus improve their techniques of statistical analysis. But the article did not extend these data transformation techniques beyond Apple to comparable technology companies, and thus could not test its conclusion against a portfolio of similar equity investments. This article presents such a calculation and assesses the results.
Advertising with the NYCPA is your opportunity to reach the greatest number of business advisors in the most important business state in the nation.
Shop our Merch Store for a quality selection of branded NYCPA and affiliate merchandise, such as shirts, hats, drinkware, and more. Show your pride, support NYCPA, and discover the perfect gift today!
Post a resume or job listing in our Career Center to connect with hundreds of employers or job seekers.
Join 21,000+ of your peers. Apply for membership today!
Find CPE Conferences, Seminars, and Online Courses Here.
Get insight and analysis into all areas of the profession.
Content provided by and exclusively for NYCPA members.
Stay up to date with important NYCPA news.
A daily roundup of the latest from around the accounting and financial industry.
A strong PAC means a strong profession. Donate Today.
Help develop a strong network of connections.
A resource for NYCPA Members.
Members, Get expert answers to technical questions.
Start your career off right with an experienced mentor.
It's never too early to start thinking about your career.