R17：Understanding Income Statements

1、Components and Format of the Income Statement：利润表的组成和格式

1.1 Components：利润表的组成

General formula: Net Income = Revenues - Expenses

Revenues：Also called sales or turnover, refers to the amount charged for the delivery of goods or services in the ordinary activities of a business.

Net revenue：Revenue less adjustments for cash or volume discounts, or for estimated returns.

主营业务收入：也称为销售或营业额，指在企业正常活动中交付商品或服务所收取的金额。

净收入：收入减去现金或数量折扣或估计回报的调整。（例如：总收入100万，打九折，或者有10万的货物被退回，则净收入是90万）

Expenses：Reflect outflows, depletion of assets, and incurrence of liabilities in the course of the activities of a business.

    - By nature: Grouping together expenses such as depreciation on manufacturing equipment and depreciation on administrative facilities Into a single line item.

    - By function: Grouping together expenses into a category such as cost of goods sold, which may include labor and material costs, depreciation some salaries（e.g., salespeoples）, and other direct sales related expenses.

费用：反映企业活动过程中的流出、资产损耗和负债发生。

  - 按性质分类：将制造设备折旧和管理设施折旧等费用组合到一个单独的行项目中。（各类电脑的折旧等）

  - 按功能分类：将费用归为一个类别，如销售商品的成本，其中可能包括劳动力和材料成本、折旧和一些工资（如销售人员）以及其他与直接销售相关的费用。（COGS）

Gain or loss：The difference between the sales price and book value is reported as a gain or loss on the income statement.

损益：销售价格和账面价值之间的差额在损益表上作为损益报告。

卖价 > 账面价值：Gain

卖价 < 账面价值：Loss

1.2 Format：利润表的格式

Income statements also present subtotals.

利润表也列示小结。

- Gross profit or gross margin
    - = Revenue - COGS
    - When an income statement shows a gross profit subtotal, it is said to use a multi-step format rather than a single-step format.

- 毛利润

  - 等于：收入 - 销货成本

  - 当损益表显示毛利润小计时，称之为使用多步列式，否则为单步列式。

- Operating profit
    - = Gross profit - Operating expenses
    - Operating expenses: Selling, general and administrative（SG&A）, research and development expenses.
    - Operating profit is sometimes referred to as EBIT（earnings before interest and taxes）. However, operating profit and EBIT are not necessarily the same.

- 营业利润

  - 等于：毛利润 - 营业费用

  - 营业费用：包括一般的销售和管理费用（SG&A），研发费用

  - 营业利润有时称为息税前利润。然而，营业利润和息税前利润不一定相同

  注：Operating profit + Other income - Other expense = EBIT，在此过程中，简化 Other income 和 Other expense 之后，Operating profit = EBIT

2、Revenue Recognition：收入的确认

2.1 General principles：Accrual accounting 权责发生制（权力和责任发生转移时记录）

Revenue is recognized when it is earned, so the company's financial records reflect revenue from the sale when the risk and reward of ownership is transferred.

收入在获得时确认，因此公司的财务记录反映了所有权风险和报酬发生转移时的销售收入。

2.2 Core principle：核心原则

Revenue should be recognized to depict the transfer of promised goodsl or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in an exchange for those goods or services.

应确认收入，以描述向客户转让承诺货物或服务的金额，该金额反映了实体在交换这些货物或服务时预期有权获得的对价。

2.3 Five-steps In recognizing revenue：确认收入的五个步骤

1. Identify the contracts with a customer；识别与客户签订的合同

2. Identify the performance obligations in the contract；确定合同中的履行义务

3. Determine the transaction price；确定交易价格

4. Allocate the transaction price to the performance obligations in the contract；将交易价格分配给合同中的履行义务（例如是建造项目，每个阶段对应分配相应的交易价格）

5. Recognize revenue when the entity satisfies a performance obligation (transferring control to the customer)；当实体履行履行义务时确认收入（将控制权转移给客户）

Note that:

1.Contract is an agreement between two or more parties. It establishes each party's obligations and rights. A contract exists only if collectability is probable

2.Performance obligation is a promise to deliver a distinct good or service. Each identified performance obligation is accounted for separately

3.Transaction price is the amount a firm expects to receive from a customer in exchange for transferring a good or service to the customer

4.Revenue should only be recognized when it is highly probable that it will not be subsequently reversed

5.For long-term contracts, revenue is recognized based on a firm's progress toward completing performance obligation.

注意：

1.合同是两方或多方之间的协议。它规定了各方的义务和权利。合同只有在可能收回时才存在（如果合同约定的价格比较离谱，大概率收不回来时，合同就形同虚设了）

2.履行义务是对交付不同货物或服务的承诺。每项确定的履行义务均需要单独列示

3.交易价格是当将商品或服务转让给客户时，公司希望从客户处获得的金额

4.只有当收入很可能不会随后退回时，才应确认收入（到手的鸭子不会飞的时候才记录该收入）

5.对于长期合同，收入是根据公司完成履约义务的进度确认的（完成30%，就记录30%收入）

2.4 Specific accounting treatment for incremental cost：增量成本的具体会计处理

- Incremental costs of obtaining a contract and certain costs incurred to fulfill a contract must be capitalized under the new standards

- If a company had previously expensed these incremental costs in the years prior to adopting the converged standard, all else equal, its profitability will initially appear higher under the converged standards

根据新标准，获得合同的增量成本和履行合同所产生的某些成本必须资本化

如果一家公司在采用趋同标准之前的几年内将这些增量成本进行费用化，在其他条件相同的情况下，资本化下其盈利能力在初期会更高（资本化在最开始的时候盈利能力会比费用化更高）

3、Expense Recognition：费用的确认

3.1 General Principles：一般原则

- Matching principle

Under matching, a company recognizes some expenses（e.g., cost of goods sold）when associated revenues are recognized and thus, expenses and revenues are matched.

- Period costs

Not all expenses can be directly tied to revenue recognition. Expenditures that less directly match revenues, are reflected in the period when a company makes the expenditure or incurs the liability to pay.（e.g., administrative expenses）

- 配比原则

在匹配下，公司在确认相关收入时确认一些费用（例如：销售商品的成本），从而匹配费用和收入，即这些可以和收入挂钩的费用，在获得收入的同时确认这些费用

- 期间成本

并非所有费用都可以直接与收入确认挂钩。与收入不太直接匹配的支出，反映在公司支出或承担支付责任的期间。（例如，管理费用，利息费用）

3.2 Issues in Expense Recognition：费用确认中的几个问题

- Doubtful accounts

When a company sells its products or services on credit, it is likely that some customers will ultimately default on their obligations. Under the matching principle, at the time revenue is recognized on a sale, a company is required to record an estimate of how much of the revenue will ultimately be uncollectible based on previous experience.

- Warranty

At times, companies offer warranties on the products they sell. Under the matching principle, a company is required to estimate the amount of future expenses resulting from its warranties, to recognize an estimated warranty expense in the period of the sale.

- Depreciation and amortization

Long-lived assets are expected to provide economic benefits beyond one accounting period. The allocation of cost over an asset's life is known as depreciation( tangible assets) , depletion( natural resources) , or amortization( intangible assets).

- 坏账准备

当一家公司赊销其产品或服务时，很可能一些客户最终会违约。根据配比原则，在确认销售收入时，公司需要根据以前的经验记录最终无法收回的收入估计数。

- 保证，保修

有时，公司对其销售的产品提供保修。根据配比原则，公司需要估计其担保产生的未来费用金额，以在销售期间确认估计的担保费用。

- 折旧和摊销

长寿命资产预计提供经济效益会超过一个会计期间。在资产寿命期间的成本分配称为折旧（有形资产）、损耗（自然资源）或摊销（无形资产）。

3.3 Implications for Financial Analysis：对财务分析的影响

- In expense recognition, choice of method（i.e., depreciation method and inventory cost method）, as well as estimates（i.e., uncollectible accounts, warranty expenses, assets useful life, and salvage value） affect a company's reported income.

- An analyst should characterize the policies and estimates as more or less conservative and thus qualitatively assess how differences in policies might affect financial ratios and judgments about companies performance.

在费用确认中，方法的选择（如折旧法和存货成本法）以及估算（如坏账、保修费用、资产使用寿命和残值）会影响公司报告的收入。

分析师应将政策和估计描述为或多或少的保守，从而定性地评估政策差异如何影响财务比率和对公司业绩的判断。

4、Non-recurring Items and Non-operating Items：非重复性项目和非经营性项目

4.1 Operating and non-operating components：营业性和非营业性收入

Operating and non-operating transactions are usually reported separately in the income statement.

For example, if a non-financial service company invests in equity or debt securities issued by another company, any interest, dividends, or profits from sales of these securities will be shown as non-operating Income.

For financial service companies, interest income and expense are likely components of operating activities

营业性和非营业性交易通常在利润表中单独报告。

例如，如果一家非金融服务公司投资于另一家公司发行的权益或债务证券，则出售这些证券产生的任何利息、股息或利润将列为非营业性收入。

对于金融服务公司而言，利息收入和费用可能是经营活动的组成部分。

4.2 Unusual or infrequent items：不寻常或不常见的项目

Reported "above the line" and presented on a pretax basis

- G/L from the sale of assets or part of a business

- Impairments, write-offs, write-downs, and restructuring costs

超出“行”报告，并在税前基础上提交

- gain 或 loss

- 减值、注销、减记和重组成本

write-offs：减值为0

write-downs：减值了一部分，没有到0

例如，一桶汽油，挥发了50%，就是write-downs，如果都挥发完了，就是write-offs

4.3 Discontinued operations（shown net of tax）：终止经营（显示为税后净额）

When a company disposes of or establishes a plan to dispose of one of its component operations and will have no further involvement in the operation, the income statement reports separately the effect of this disposal as a discontinued operation under both IFRS and US GAAP

当一家公司处置或制定计划处置其一项组成业务且不再参与该业务时，损益表根据IFRS和美国公认会计准则将该处置作为终止经营业务单独报告

例如，一家服装企业，如果觉得不再生产男装，则需要把该业务下的金额归到终止经营业务

4.4 Change in accounting policies：会计政策变更

<1> Change in accounting principle: May be retrospective application

    - For example, a change from one GAAP or IFRS method to another.

    - Retrospective application means that the financial statements for all fiscal years shown in a company's financial report are presented

<2> Change in accounting estimate: Prospectively applied

<3> Correction of an error for a prior period: Retrospective application 

1.会计原则变更：追溯调整

    - 例如，从一种GAAP或IFRS方法到另一种方法的变更。

    - 追溯调整应用是指公司财务报告中显示的所有会计年度的财务报表

例如：从GAAP调整为IFRS，如果今年是2020年，则需要把2020年和2019年的报表都调整为新的会计准则

2.会计估计变更：未来适用，不需对以前的报表进行调整

例如：对于小汽车适用年限的估计，之前是石子路，估计使用10年，现在是柏油路，估计使用15年

3.更正前期错误：追溯调整

5、Earnings Per Share：每股收益（EPS）

5.1 Definition：

Earnings per share( EPS) is calculated as a company's profit divided by the outstanding shares of its common stock( common shares, Ordinary shares) . The resulting number serves as an indicator of a company's profitability

每股收益（EPS）计算为公司利润除以其在外发行的普通股数量。由此得出的数字可作为公司盈利能力的指标

5.2 Classification：

When a company has issued any financial instruments that are potentially convertible into common stock, it is said to have a complex capital structure. If a company's capital structure does not include such convertible financial instruments, it is said to have a simple capital structure.

当一家公司发行了任何可能转换为普通股的金融工具时，就说它是复杂的资本结构。如果一家公司的资本结构不包括此类可转换金融工具，则称其简单的资本结构。

Simple capital structure -> Basic EPS

Complex capital structure -> Basic EPS & Dilutive EPS

    - Convertible debt

    - Convertible preferred stock

    - Stock option

    - Warrants

简单资本结构 -> 基本每股收益

复杂资本结构 -> 基本每股收益 和 稀释的每股收益（包括以下4种资本结构之一的就是复杂资本结构）

    - 可转债

    - 可转优先股

    - 期权（给股东的一个权力，未来可以以某种价格购买公司的股票）

    - 权证（给股东的一个权力，未来可以以某种价格购买公司的股票）

5.3 Basic EPS：基本每股收益

Basic EPS is the amount of income available to common shareholders divided by the weighted average number of common shares outstanding over a period.

基本每股收益是普通股股东可获得的收入除以一段时间内发行在外普通股的加权平均数。

Formula：

- Numerator: The amount of net income remaining after preferred dividends（if any） have been paid

- Denominator: A time weighting of common shares outstanding.

    - New issue & repurchase: Weighted by time( days or months)

    - Stock dividend & stock split: Retrospective application

- 分子：支付优先股息（如有）后剩余的净收入金额

- 分母：已发行普通股的按时间加权

    - 新发行和回购：按时间加权（天或月）

    - 股票分红和拆股：追溯调整

5月1日前的股票都需要1拆2

9月1日前的股票都需要增10%

5.4 Diluted EPS：稀释每股收益

If a company has a simple capital structure, then its basic EPS is equal to its diluted EPS. However, if a company has potentially dilutive financial instruments, its diluted EPS may differ from its basic EPS.

- Convertible preferred stock

- Convertible debt

- Employee stock options / warrants

如果一家公司的资本结构简单，那么其基本每股收益等于稀释每股收益。然而，如果一家公司拥有潜在的稀释性金融工具，其稀释每股收益可能不同于其基本每股收益。

- 可转换优先股

- 可转换债券

- 员工股票期权 / 认股权证

<1> Convertible preferred stock：可转换优先股

When a company has convertible preferred stock outstanding, diluted EPS is calculated using the if-converted method.（What EPS would have been if the convertible preferred securities had been converted at the beginning of the period.）

If the convertible shares had been converted, there would be two effects:

    - Numerator: The company would not have paid preferred dividends

    - Denominator: Additional common stock would be outstanding

当一家公司拥有流通的可转换优先股时，稀释每股收益使用"如果转换法"计算。（如果可转换优先股在期初转换，每股收益会是多少。）

如果可转换股份已转换，将产生两种影响：

    - 分子：公司不会支付优先股息

    - 分母：额外的普通股将流通

<2> Convertible debt：可转换债券

When a company has convertible debt outstanding, the diluted EPS calculation also uses the if-converted method. (What EPS would have been if the convertible debt had been converted at the beginning of the period.）

If the convertible shares had been converted, there would be two effects:

    - Numerator: The company would not have paid interest on the convertible debt

    - Denominator: Additional common stock would be outstanding（no longer debt security）

当一家公司有未偿还的可转换债务时，稀释每股收益的计算也使用"如果转换法"。（如果可转换债务在期初转换，每股收益是多少。）

如果可转换股份已转换，将产生两种影响：

    - 分子：公司不会支付可转换债券的利息

    - 分母：额外发行的普通股（不再是债务证券）

<3> Employee stock options / warrants：员工股票期权 / 认股权证

When a company has stock options, the diluted EPS calculation uses the Treasury stock method. (If the financial instruments had been exercised and the company had used the proceeds from exercise to repurchase shares at the weighted average market price during the period)

If the stock options had been exercised, there would be two effects:

    - Denominator: The weighted average number of shares outstanding is increased by the number of shares that would be issued upon exercise minus the number of shares that would have been purchased with the proceeds

当公司拥有股票期权时，稀释每股收益的计算采用库存股法。（如果金融工具已行权，且公司已使用行权收益在该期间以加权平均市场价格回购股份）

如果行使了股票期权，将产生两种影响：

    - 分母：已发行股份的加权平均数由行权时将发行的股份数减去将用收益购买的股份数增加。

<4> Other issues with diluted EPS：稀释每股收益的其他问题

Diluted EPS will always be less than or equal to basic EPS.

It is possible that some potentially convertible securities could be antidilutive. Antidilutive securities are not included in the calculation of diluted EPS.

稀释每股收益一般情况下会小于或等于基本每股收益。

一些潜在的可转换证券可能会起到反稀释作用。稀释每股收益的计算中不包括反稀释证券。

如果反稀释的每股收益大于基本每股收益，则取 Basic EPS。

注：可转换优先股、可转债可能出现反稀释作用，员工股票期权 / 认股权证不会出现反稀释作用。

6、Analysis of the Income Statement：利润表的分析方法

6.1 Common-size analysis：同型分析

Common-size analysis of the income statement can be performed by stating each line item on the income statement as percentage of revenue.

Common-size statements facilitate comparison across time periods(time series analysis) and across companies( cross-sectional analysis)because the standardization of each line item removes the effect of size.

利润表的同型分析可以通过将利润表上的每一行项目列为总收入的百分比来执行。

同型规模报表有助于跨时间段（时间序列分析）和跨公司（横截面分析）的比较，因为每个行项目的标准化消除了规模的影响。

6.2 Income statement ratios：比率分析

<1> Net profit margin( Also known as profit margin and return on sales)：净利率（也称为利润率和销售回报率）

- A higher level of net profit margin indicates higher profitability. 

- 净利润率越高，说明盈利能力越高

<2> Gross profit margin( Also known as gross margin)：毛利率

- A higher level of gross profit margin indicates higher profitability.

- Differences in gross profit margins across companies reflect differences in companies'strategies.

- 毛利率水平越高，说明盈利能力越高

- 不同公司毛利率的差异反映了公司战略的差异（例如：薄利多销）

<3> Other margins：其他比率

7、Comprehensive Income：综合收益

7.1 Other comprehensive income both IFRS and US GAAP：国际会计准则和美国会计准则下的共有的4个其他综合收益

<1> Foreign currency translation adjustments

外币汇兑损益

<2> Unrealized holding gains and losses on a certain category of investment securities, namely, "available-for-sale debt securities", under US GAAP and securities designated as "fair value through other comprehensive income", under IFRS

某类投资证券的未实现持有损益，即美国公认会计原则下的“可供出售债务证券”，以及国际财务报告准则下指定为“通过其他综合收益实现公允价值”的证券

例如：购买的债券还没有到期，只是出现的浮盈和浮亏

<3> Unrealized gains or losses on derivatives contracts accounted for as hedges

衍生工具合同的未实现收益或损失作为套期保值

<4> Certain costs of a company's defined benefit post-retirement plans that are not recognized in the current period

 确定收益型养老金计划（BD）的成本变动

7.2 Other comprehensive income under IFRS：国际会计准则下独有的1个其他综合收益

Changes in the surplus of long-lived assets that are measured using the revaluation model rather than the cost model

使用重估模型而非成本模型计量的长期资产盈余的变化（美国会计准则下不允许使用该模型）

8、Summary