Definition of Underlying profit:
Basic profit is a calculation that a company works internally to show that it is a more accurate reflection of how much money it makes. These numbers focus on events in your regular billing cycle and usually do not include single or unexpected events. The basic profit differs from the required profit in accounting, which is stated in the financial statements and other mandatory documents that comply with established procedures, rules and regulations.
The actual results of a company used for business planning are not a measure, results listed for accounting or regulatory purposes. This type of profit measurement is usually focused on normal events in the billing cycle, with the exception of exceptional circumstances or certain events.
When companies publish their financial statements, generally accepted accounting principles (GAAP) are required to disclose the benefits accrued. This is calculated by deducting all dollar expenses from income. The same calculation is used to determine the amount of tax paid.
How to use Underlying profit in a sentence?
- The basic profit is calculated by the company to show that it is considering reading the profit position correctly.
- Each company has its own basic profitable version, has an accounting profit and then adjusts whatever is deemed appropriate.
- These numbers are based on events in your regular billing cycle and usually do not include single or unexpected events.
Meaning of Underlying profit & Underlying profit Definition