Economy
Gunns: A new accounting method?
Jarvis Cocker
1. In Gunns Limited’s half-year report, earnings per share are stated to be 6.2 cents per share. My calculations, and those of at least two other analysts put the figure at 3.9. That’s a serious discrepancy, and if my numbers are correct, Gunns has misled the ASX. Given EPS is a fundamental measure of both a company’s performance and valuation, this warrants immediate investigation. Perhaps Gunns’ accountant forgot that more than 300 million new shares have been issued recently, and forgot to update the spreadsheet. Or perhaps they’ve invented a new accounting standard that Jarvis is as yet unfamiliar with. Read more, Comment here