应纳税所得额以及分析外文翻译.doc

外文 原文 Taxable income and analysis Material Source:CA Magazine Author: Suzanne Landry and Nadi Chlala It can be a useful element to assess the quality of earnings reported by listed entities The financial scandals of the past few years have underscored how important it is for investors to consider the quality of earnings reported by listed entities. Despite the existence of many benchmarks, the financial market seemed unable to foresee these events. Recently, an attempt was made to assess earnings quality by connecting the dots between pre-tax income (accounting income) and taxable income, the argument being it would be unusual for a company to report high net earnings while showing little or no tax liability. The Enron case was cited as an example because between 1996 and 1999 the company had no taxable income, even though it reported accounting income of US$2.3 billion in the same period. Similarly, the WorldCom affair was evoked, where Andersen was blamed for failing to question the gap between accounting income and taxable income. There are a number of useful factors to consider if taxable income is to be used as a benchmark to assess the quality of reported earnings, and the appropriateness of such a benchmark and its limitations need to be examined. Earnings quality assessment factors Investors use different benchmarks to analyze an enterprise’s earnings. The purpose of these benchmarks is to verify two specific characteristics of reported earnings. The first concerns the relevance of earnings to decision-making. The more net earnings reflect the enterprise’s economic performance, the more they are perceived as being of good quality and the more financial statement users will be able to rely on them for decision-making. The second characteristic is the absence of management bias. Net earnings are compared to other figures that require fewer estimates and are thus less likely to be biased, such as cash flow from operations. The more net earnings are consist