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Thursday, September 16, 2010

Managing One-off

It's becoming more and more common for companies to include one-off when reporting earnings. The rationale for disclosing one-off is to provide investors & analysts with information about what are recurring items in earnings result. However, there are situations where it is difficult to assess whether such items are genuinely one-off.

In our own lives, we too would like to conclude our spendings as one-off. The oversea trip last year, buying the new tv, or the fine dining last weekend.

Again, each individual attach different value to different items and I have no interest in suggesting what you should or should not do. What I am suggesting is that the one-off expenditure are actually recurring cost. For example, are annual holiday trips really one-off?

So how does that help you? Well, the sooner you come to turns with your "one-off" are actually recurring expenses, the sooner you can set aside money for it and plan ahead. Ultimately, if you know how much you are spending, you will know how much you are saving.

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