Valuation Guidance

Question I.B: Revenue & Pre-Tax Profit

Survey Instructions:

o For publicly traded companies in the U.S., CECP staff will find and enter these numbers for you. Publicly traded companies report this information in annual 10-K filings with the SEC. Such filings, along with annual corporate reports, can typically be found on a company’s website in an “Investor Relations” section.

o If your company is privately held or headquartered outside of the U.S., these figures can be obtained through your company’s finance department. Survey entry instructions are as follows:

§ Enter the full dollar amount (including all zeros, but not cents).

§ Convert all financial figures to U.S. dollars by using the conversion rate listed in your company’s annual report or as of the last day of the Fiscal Year.

§ In their annual reports and filings, many companies do not distinguish domestic revenues (or domestic pre-tax profits) from international revenues (or international pre-tax profits). If a breakdown is not available, enter totals in the “consolidated” field.

§ Negative revenues and negative pre-tax profits should be recorded with a negative sign. However, as a result, the CGS system will be unable to perform certain calculations—such as Total Giving as a Percentage of Revenue/Pre-Tax Profit—for your company.

Willing to Share? Yes!

If your company is publicly traded, then your company’s financial information is public information by law and thus will be shared automatically within the CECP community.

Revenue (Domestic and International):

Total amount of money from all income sources that came into your company in the previous year.

o In annual company reports, this figure is often labeled one of the following: Net Sales, Total Revenue, Revenues, Total Revenues and Other Income, Operating Revenues, or Sales.

o For banks, this is often the sum of “Interest Income” and “Non-Interest Income” minus “Interest Expense.”

Pre-Tax Profit (Domestic and International):

Money remaining after costs (but not taxes) have been deducted from revenues.

o In annual reports and SEC filings, this figure is often listed as one of the following: “Income (loss) from continuing operations before taxes and cumulative effect of accounting changes,” “Income before income taxes and minority interests,” or “Income (loss) from continuing operations before taxes.”

o Banks typically report their pre-tax profit using the same terms as described above.

o This is not the same as Net Income.

o If it appears that taxes have been deducted, you must add them back in.