What is an Earnings Restatement?
An earnings restatement, also called an financial statements.recast, is the act of disclosing amended
How Does an Earnings Restatement Work?
Let's assume Company XYZ sells its pharmaceutical division to Company ABC. The pharmaceutical division was a significant generator of revenue for Company XYZ.
After the sale, itan earnings restatement by disclosing the last five years of -- with the pharmaceutical division excluded.
Why Does an Earnings Restatement Matter?
Earnings restatements can be corrections in, but they 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.