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Corporate Profits in the GDP Accounts
Rosemary MarcussDeputy DirectorBureau of Economic Analysis
Economic Statisticshellipfrom Theory to PracticeNational Association of Business Economics
Kissimmee Florida May 2004
wwwbeagov
Profits Get Extensive Media Attentionbull But what does this tell us about the economy
wwwbeagov
Why BEA Profits
bull There is a need for a measure of corporate profits consistent with other macroeconomic measures in BEArsquos ldquoUS economic accountsrdquo
bull BEA measure Profits from Current Production (called ldquoCorporate Profits with IVA and CCAdjrdquo)ndash Measures income earned by corporations from current production
before tax liabilityndash Excludes financing flows and capital gains and lossesndash Values inventory withdrawals at current cost (adjustment called the
ldquoIVArdquo)ndash Estimates economic depreciation at current cost (adjustment called the
ldquoCCAdjrdquo)
wwwbeagov
US Economic AccountsGross Domestic Income (GDI) Gross Domestic Product (GDP)
7157
14
1528
7
0
20
40
60
80
100
Employee CompensationPersonal Consumption
Investment
Govt and Net Exports
Taxes on Production
Corporate Profits 8
Gross Operating Surplus (Capital Income)
36
wwwbeagov
An Eye on GDP Components
-20
0
20
40
60
80
71
1519
10
-14
Personal Consumption
InvestmentGovernment
Exports
Imports
wwwbeagov
How are Corporate Profits Used
bull By Wall Street to track overall US corporate financial health
bull By industry analysts to track industry financial health
bull By macro forecasters to project investment in plant and equipment
bull By government policy-makers to project tax receipts
wwwbeagov
There are Lots of Profits Reportsbull Each corporation reports its profits in two different
waysndash To the public to inform investors and ndash To the IRS to report income for tax purposes
bull BEA uses that information when it creates the US economic accounts In particular it creates an economy-wide consistent-over-time measure of total profits earned by all corporations
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Profits Get Extensive Media Attentionbull But what does this tell us about the economy
wwwbeagov
Why BEA Profits
bull There is a need for a measure of corporate profits consistent with other macroeconomic measures in BEArsquos ldquoUS economic accountsrdquo
bull BEA measure Profits from Current Production (called ldquoCorporate Profits with IVA and CCAdjrdquo)ndash Measures income earned by corporations from current production
before tax liabilityndash Excludes financing flows and capital gains and lossesndash Values inventory withdrawals at current cost (adjustment called the
ldquoIVArdquo)ndash Estimates economic depreciation at current cost (adjustment called the
ldquoCCAdjrdquo)
wwwbeagov
US Economic AccountsGross Domestic Income (GDI) Gross Domestic Product (GDP)
7157
14
1528
7
0
20
40
60
80
100
Employee CompensationPersonal Consumption
Investment
Govt and Net Exports
Taxes on Production
Corporate Profits 8
Gross Operating Surplus (Capital Income)
36
wwwbeagov
An Eye on GDP Components
-20
0
20
40
60
80
71
1519
10
-14
Personal Consumption
InvestmentGovernment
Exports
Imports
wwwbeagov
How are Corporate Profits Used
bull By Wall Street to track overall US corporate financial health
bull By industry analysts to track industry financial health
bull By macro forecasters to project investment in plant and equipment
bull By government policy-makers to project tax receipts
wwwbeagov
There are Lots of Profits Reportsbull Each corporation reports its profits in two different
waysndash To the public to inform investors and ndash To the IRS to report income for tax purposes
bull BEA uses that information when it creates the US economic accounts In particular it creates an economy-wide consistent-over-time measure of total profits earned by all corporations
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Why BEA Profits
bull There is a need for a measure of corporate profits consistent with other macroeconomic measures in BEArsquos ldquoUS economic accountsrdquo
bull BEA measure Profits from Current Production (called ldquoCorporate Profits with IVA and CCAdjrdquo)ndash Measures income earned by corporations from current production
before tax liabilityndash Excludes financing flows and capital gains and lossesndash Values inventory withdrawals at current cost (adjustment called the
ldquoIVArdquo)ndash Estimates economic depreciation at current cost (adjustment called the
ldquoCCAdjrdquo)
wwwbeagov
US Economic AccountsGross Domestic Income (GDI) Gross Domestic Product (GDP)
7157
14
1528
7
0
20
40
60
80
100
Employee CompensationPersonal Consumption
Investment
Govt and Net Exports
Taxes on Production
Corporate Profits 8
Gross Operating Surplus (Capital Income)
36
wwwbeagov
An Eye on GDP Components
-20
0
20
40
60
80
71
1519
10
-14
Personal Consumption
InvestmentGovernment
Exports
Imports
wwwbeagov
How are Corporate Profits Used
bull By Wall Street to track overall US corporate financial health
bull By industry analysts to track industry financial health
bull By macro forecasters to project investment in plant and equipment
bull By government policy-makers to project tax receipts
wwwbeagov
There are Lots of Profits Reportsbull Each corporation reports its profits in two different
waysndash To the public to inform investors and ndash To the IRS to report income for tax purposes
bull BEA uses that information when it creates the US economic accounts In particular it creates an economy-wide consistent-over-time measure of total profits earned by all corporations
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
US Economic AccountsGross Domestic Income (GDI) Gross Domestic Product (GDP)
7157
14
1528
7
0
20
40
60
80
100
Employee CompensationPersonal Consumption
Investment
Govt and Net Exports
Taxes on Production
Corporate Profits 8
Gross Operating Surplus (Capital Income)
36
wwwbeagov
An Eye on GDP Components
-20
0
20
40
60
80
71
1519
10
-14
Personal Consumption
InvestmentGovernment
Exports
Imports
wwwbeagov
How are Corporate Profits Used
bull By Wall Street to track overall US corporate financial health
bull By industry analysts to track industry financial health
bull By macro forecasters to project investment in plant and equipment
bull By government policy-makers to project tax receipts
wwwbeagov
There are Lots of Profits Reportsbull Each corporation reports its profits in two different
waysndash To the public to inform investors and ndash To the IRS to report income for tax purposes
bull BEA uses that information when it creates the US economic accounts In particular it creates an economy-wide consistent-over-time measure of total profits earned by all corporations
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
An Eye on GDP Components
-20
0
20
40
60
80
71
1519
10
-14
Personal Consumption
InvestmentGovernment
Exports
Imports
wwwbeagov
How are Corporate Profits Used
bull By Wall Street to track overall US corporate financial health
bull By industry analysts to track industry financial health
bull By macro forecasters to project investment in plant and equipment
bull By government policy-makers to project tax receipts
wwwbeagov
There are Lots of Profits Reportsbull Each corporation reports its profits in two different
waysndash To the public to inform investors and ndash To the IRS to report income for tax purposes
bull BEA uses that information when it creates the US economic accounts In particular it creates an economy-wide consistent-over-time measure of total profits earned by all corporations
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
How are Corporate Profits Used
bull By Wall Street to track overall US corporate financial health
bull By industry analysts to track industry financial health
bull By macro forecasters to project investment in plant and equipment
bull By government policy-makers to project tax receipts
wwwbeagov
There are Lots of Profits Reportsbull Each corporation reports its profits in two different
waysndash To the public to inform investors and ndash To the IRS to report income for tax purposes
bull BEA uses that information when it creates the US economic accounts In particular it creates an economy-wide consistent-over-time measure of total profits earned by all corporations
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
There are Lots of Profits Reportsbull Each corporation reports its profits in two different
waysndash To the public to inform investors and ndash To the IRS to report income for tax purposes
bull BEA uses that information when it creates the US economic accounts In particular it creates an economy-wide consistent-over-time measure of total profits earned by all corporations
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Corporate Profits Reported to the Public bull Annual financial statements follow
standards that emphasize consistency over time for each corporation
bull Flexibility allowed on methods and measures
bull Outside audits required to curb exploitation of flexibility
bull Uniformity across corporations is low
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Corporate Profits Reported to the IRS bull Both public and privately-held
corporations file tax returns which are confidential
bull Little-to-no flexibility allowed on methods and measures
bull Tax rates income definition and incentive provisions change diminishing consistency over time
bull Statistical sample provides an economy-wide profits measure with a lag
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
BEA Economic not Administrative
bull Profits from Current Production arendash Unaffected by tax-law and reporting-rule changesndash Inclusive of income that escapes tax authoritiesndash Exclusive of dividends capital gains and losses and other
flows arising from means of financing productionndash Exclusive of financial adjustments reported for other
purposes such as deduction for ldquobad debtrdquo ndash Measured consistently with data beginning in 1929
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Profits are Cyclically Sensitive
$0
$200
$400
$600
$800
$1000
$1200
$1400
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
($ in billions)
Profits from Current Production
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Disposition of Corporate ProfitsIn $ Billions 20034
Profits from Current Production 1206(Corporate Profits with IVA and CCAdj)
Less Taxes 244
Equals Profits after tax 962 Of which Dividends (net) 442 Undistributed profits 520
Internally-generated corporate funds available for investment or cash flow
Undistributed profits 520 Plus Consumption of fixed capital 757 (or depreciation)
Equals Cash flow 1277 Include IVA and CCAdj
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Corporate Cash Flow A Source of Investment
$0
$250
$500
$750
$1000
$1250
$1500
$1750
$2000
$2250
$2500
70I 72III 75I 77III 80I 82III 85I 87III 90I 92III 95I 97III 00I 02III
Cash Flow Nonresidential private fixed investment
($ in billions)Corporate Cash Flow and Investment (Adjusted for Price Change)
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
SampP 500 Index Broad Measure but Differentbull Purpose to benchmark performance of
corporations in current yearbull Composition large representation of publicly-
traded corporations changing year-to-year as market values capitalization and trading activities change
bull Data base after-tax income reported on financial statements
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Similar Trend with Notable Divergence
(Indexed 1990II = 100)
Source Bureau of Economic Analysis and Standard amp Poorrsquos Inc
BEA Profits (Index) and Standard amp Poorrsquos Earnings Index
0
50
100
150
200
250
300
350
90II 91II 92II 93II 94II 95II 96II 97II 98II 99II 00II 01II
BEA Profits SampP Index
DJIASept 1998
7910
DJIAOct 2002
8048
DJIASept 2000
10968
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Data Sources Used to Estimate Profitsbull Financial-Accounting Data
ndash Census Bureau Quarterly Financial Reports (QFR)bull Available quarterly within several months of end of quarterbull Cover manufacturing mining and trade - roughly 13 of profits
ndash Data from regulatory agencies other source used to supplement QFR data
bull Tax-Accounting Datandash IRS Statistics of Income (SOI) Data
bull Corporate income-tax return (annual) databull Available with a lag of two years
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Corporate Profits Release Schedule
bull Quarterly estimates are available quickly - two months after end of quarter
bull Additional information is incorporated as it becomes available - revised estimates for the most recent three years released every summer
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
And BEA Reports on Profits
bull ldquoBusiness Situationrdquo in the Survey of Current Business
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
BEA Web Site has Everything
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l
wwwbeagov
Go to Corporate Profits ldquoPagerdquo
J
l