You're right. They have to report the "legit" numbers. But - there is a section in the reports with all manner of notes and hand waving that accompany these reports.
It's a tough call. GAAP isn't going to adequately explain the nuance of every business, so notes are appropriate to explain things better.
But, bankers and accountants take advantage of this and twist the notes beyond sane bounds in an effort to make the earnings look good. Taken too far, this behavior can invalidate the accounting reports, making them totally opaque.
There isn't a right or wrong answer here. This example, I think, is pretty silly - as it's not a difficult thing to glean this info from the standard reports. But there are cases where strange accounting practices are good and helpful because underlying business is itself strange.
It's a tough call. GAAP isn't going to adequately explain the nuance of every business, so notes are appropriate to explain things better.
But, bankers and accountants take advantage of this and twist the notes beyond sane bounds in an effort to make the earnings look good. Taken too far, this behavior can invalidate the accounting reports, making them totally opaque.
There isn't a right or wrong answer here. This example, I think, is pretty silly - as it's not a difficult thing to glean this info from the standard reports. But there are cases where strange accounting practices are good and helpful because underlying business is itself strange.