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Truth in Reporting --Dickeson

March 2005
One thing that has puzzled me for many years is how printing companies can stay alive with the kind of operating income they report to the Printing Industries of America (PIA). These reports are the basis for the Ratio Studies that PIA publishes annually. Surely the reports of 600 to 900 companies, as a cross-section of our industry, must be true. true as can be expected with the general ledger financial reporting system we have in place.

Am I suggesting that there's something wrong with the general ledger system we use? Do I join with Trevor Harris, chief accounting analyst at Morgan Stanley, in saying "the financial reporting system is completely broken?" Perhaps. Take a hard look at the last six years of the PIA Ratio Studies and tell me what you think.

Year Ending200320022001200019991998
Upper Quartile
Number of Firms125165201198216234
Less Materials, etc.34.20%35.97%35.49%35.72%36.09%36.76%
Value Added65.80%64.03%64.51%64.28%63.91%63.24%


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