Republican Tax Plan Horror Story - NetFlix +$845 millon profit / $0 taxes / $22 million tax rebate!

[Igel]

24. Another poster pointed out that there are

two accounting schemes used, and they differ in how you treat depreciation.

Since one is for taxes is used consistently that way, that's one number. And it's valid.

The other is used for corporate reports. It's used consistently that way, and that's a second number. And it's valid.

The org I was with in the '90s had used some sort of cash accounting and then switched over to GAAP. Those who had been reading the reports for years were horrified at the new reports. In spite of the fact that little had changed. It was a question of figuring out what the numbers meant in a given context, where the liabilities were, were the assets were, and how things were being moved around. Took old-timers a few months to come to grips.

What old timers really had trouble with was reconciling the current scheme with past year's numbers. So somebody had to go back and redo a lot of the reports for the previous few years to make the historical trendlines reasonable.