Investor Glossary-pro formaInvestor Glossary-pro formaInvestor Glossary-pro formaInvestor Glossary-pro formaInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Pro Forma

The HTML to link to this page
 

Pro forma financial statements are financial statements that include projections into the future. Interpretation of pro forma financials requires considerable caution. First, the pro forma results are inevitably based upon numerous critical assumptions, many of which may be hidden even if detailed explanatory notes accompany the pro forma financials. Second, GAAP does not encompass such forward-looking estimates. Since pro forma financial statements do not adhere to GAAP anyway, the financial statements may reflect accounting choices that would not be acceptable in practice. Consequently, pro forma financials may (knowingly or unknowingly) misrepresent actual results even if all the underlying assumptions were to prove correct. Nevertheless, no business plan would be complete without detailed pro forma financial statements. Pro forma financial statements are also developed to evaluate potential mergers, acquisitions, and spin-offs. Pro forma is Latin for "as a matter of form."



Rate this pro forma definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: implied volatility, EBITDA, minority interest, VIX, class C shares, 1035 exchange, real GDP, 401a, labor relations, per diem, required rate of return, reverse mortgage, stock market close, inflation, LIBOR, margin rate, 144a, debt service coverage, diluted share, in escrow, dividends payable, retained earnings, option premium, Key Rate Duration, quality assurance, FTSE, liquidity ratio, irrevocable trust, command economy, deferred revenue, wholly-owned subsidiary, cancelled check, covered put, average price per share, APR, Zero Cost Collar, 1031 exchange, current ratio, FICO score, balance sheet, annual return, stock split, deferred tax, ex-dividend date, phantom income, ex-dividend, open position, risk management, limit order


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use