What it is:
An earnings recast, also called an financial statements.restatement, is the act of disclosing amended
How it works (Example):
Let's assume Company XYZ sells its pharmaceutical division to Company ABC. The pharmaceutical division was a significant generator offor Company XYZ.
After the sale, it an earnings recast by disclosing the last five years of -- with the pharmaceutical division excluded.
Why it Matters:
Earnings recasts can be corrections inhey can also help investors get a comparative sense of how a company is performing without a recently divested , with a change in method, or with some other significant change in operations.