Recent revisions to corporate profits: what we know and when we knew it

Bang, April; Chernoff, Brian; Himmelberg, Charles P.; Mahoney, James M.

Journal Article

Recent revisions to corporate profits: what we know and when we knew it

Abstract: Initial estimates in the National Income and Product Accounts significantly overstated U.S. corporate profits for the 1998-2000 period. Subsequent revisions reveal that the profitability of the nation's corporate sector in the late 1990s was substantially weaker than \\"real-time\\" data indicated. An unexpected surge in employee stock options exercised-and perhaps, in some sectors, firms' inflated statements of profit-may help explain the large downward revisions.

Keywords: Statistics; Corporate profits; Economic indicators; Stock options;