Accounting For Earning Per Share

Earnings per share (EPS) is defined as net income divided by the number of shares of stock issued to stockholders. Higher EPS values indicate the company is earning more net income per share of stock outstanding. Because EPS is one of the five performance measures on which your company is graded (see p. 2 of the GSR) and because your company has a higher EPS target each year, you should monitor EPS regularly and take actions to boost EPS. One way to boost EPS is to pursue actions that will raise net income (the numerator in the formula for calculating EPS). A second means of boosting EPS is to repurchase shares of

I could not find the 210-10-01 so I will over the 210-10 (General) In this section the FASB explains how the accounting standars was updated. It also talks about the securities and exchange section (SEC). We can say that the section identifies the changes to this subtopics resulting from accounting standard updates.

The Financial Accounting Standards Board goes through an elaborate information gathering process before issuing their standards. Firstly, an issue is identified and placed on the Board 's agenda by the Emerging Issues Task Force. Secondly, a task force of knowledgeable persons is appointed to advise the Board on the issue. Thirdly, the Board 's technical staff investigates the issue. Fourthly, a discussion memorandum on the issue is then written and distributed to interested parties. Fifthly, the

The purpose of creating FASB is to establish standards of financial accounting that control the establishment of financial reports by nongovernmental organizations. This instance is identified as the number one authority by the SEC and the American Institute of Certified Public.FASB Accounting Standards Codification serves as a reference guide of authoritative standards for accounting and reporting, to be applied by nongovernmental organizations. Some examples are; ASC 830-230-55-1 that can identify as Statement of Cash Flows for Manufacturing Organization with Foreign Operations, ASC 926-330-35-1 can be justified as Products Held for Sale, ASC 954-440-25-2 identified as Continuing Care Retirement Community, ASC 505-20-50–1 means Equity, Stock Dividends and Stock Split and Disclosure, ASC 710-10-05-6 describe as Employees Compensations..

Earnings Per Share: measures net income per common share by dividing net income by number of shares outstanding.

Wide range of entities will be impacted by the introduction of AASB 15, especially in the industry of construction, manufacturing, telecommunications and real estate (Moore Stephens Australia, 2015). While Deloitte (2016) stated that many companies may face a challenging implementation as AASB could not only impact an organisation’s financial reporting, but also may have changes to existing processes, internal controls and other business elements. For Lend lease, many impacts might be arisen on transaction as it is a construction company. The first one can be concluded that by adopting AASB 15, construction companies like Lend lease can bring revenue forward. An example of AASB 15 may result in revenue being recognised earlier than existing accounting standard is where the construction contract includes an award bonus. AASB 15 will include the bonus from the

By June 8, 2016, the Board had completed its initial deliberations on the disclosure requirements for income taxes. The Board reversed its previous decision and decided not to require an entity to disaggregate the cumulative amount of indefinitely reinvested foreign earnings for any country that represents at least 10 percent of the total cumulative amount. Instead, the Board decided to require disclosure of the aggregate of cash, cash equivalents, and marketable securities held by foreign subsidiaries. The Board made adjustments to the language used in the exposure draft replacing the term public entity with the term public business entity as defined in the Master Glossary of the Codification.

When the executives decide that earnings should be retained, they have to account for them on the balance sheet under shareholder equity. This allows investors to see how much money has been put into the business over the years. Once you learn to read the income statement, you can use the retained earnings figure to make a decision on how wisely management is deploying and investing the shareholders ' money. If you notice a company is plowing all of its earnings back into itself and isn 't experiencing exceptionally high growth, you can be sure that the stock holders would be better served if the board of directors declared a dividend.

EPS is calculated as a ratio of earnings (Net Income – Preferred Dividends) to the average number of outstanding

EPS is the amount of earnings per each outstanding share of a company 's stock. The EPS formula does not include preferred dividend for categories outside of continued operations and net income. Earnings per share for continuing operations and net income are more complicated in that any preferred dividends are removed from net income before calculating EPS. (I.M. Pandey, n.d).

A graph below represents Earning per Share ratio. EPS ratio is used when the company wants to know how are they doing in their businesses from year to year. EPS is shown in pence. (Dyson, 2010) A year 2009 was not so profitable for company as EPS was -2,79p. This means that business was making little money, which was not good for shareholders. However, in 2010 the EPS was quite high, 14,76p, what means the company is making profit and shareholders want to invest in business.

The Earnings Per share in 2012 and 2013 were $2.90. This is an indicator that the company is still profitable since the ratio is a constant. The price per earnings in 2012 was 12.5 and 17.7 in 2013. A decrease in the price per share may indicate a vote of no confidence to investors. However, this can be attributed to the industry sector as well the stock.

Potential investors examining Caterpillar’s stock’s value will see that Cat outperforms the competition in almost every area concerning stock valuation. Earnings per share is a measure of a company’s net income relative to the number of shares of common stock outstanding. Caterpillar’s earnings per share of 7.40 dominated the industry in 2011. The second best EPS in the industry was 3.91, posted by CNH Global.

Global accounting standard setter joined hands to work in a coordinated manner to achieve the goal of creation of single set of accounting standards. Thus, IASB and FASB in response to the issues arisen due to the financial crisis started development of new set of standards. They decided to replace IAS 39 by and built and sub divided the project into three phases:

ESAA’s standards committee started a project to update EASs to comply with changes and additions to IFRSs. It is expected