Eliminating unrealized gains from income statement

You may post your suggestions about Capitalism Lab here
Post Reply
bdubbs
Level 3 user
Posts: 59
Joined: Sun Feb 28, 2016 9:15 am

Eliminating unrealized gains from income statement

Post by bdubbs »

We are playing this game from the perspective of an insider on our company and thus there's no real need to start abiding by actual GAAP rules, though if the game took it to that level I'd personally find it interesting. But that's an entire overhaul in its own way, I'd rather stick to something small that still makes a difference.

I just don't like the way net income is calculated. The fact that new assets you purchased never come up as an expense on the income statement has always bothered me, but I would never expect a game to actually force people to learn any amount of corporate accounting to understand the financial statements in game. The income statement is really just an operating income statement that includes gains and losses from stocks, changes in land value, and interest paid. I think that's perfect for the purposes of this game but I think the income statement could do without changes in land value and unrealized gains and losses in stock being included in net income.

If you sell stock or a building you should see the profit or loss on the income statement in the year you sold it, and only in that year. Just taking your operating income - any interest paid on a bank loan in years no stock or buildings are sold would be a more accurate reflection of net income than the current system imo.
User avatar
williammgary1
Level 3 user
Posts: 91
Joined: Mon Apr 16, 2018 10:07 pm

Re: Eliminating unrealized gains from income statement

Post by williammgary1 »

I think an improvement (and introduction of new) to the financial statements would be a welcomed edition to the banking DLC
Post Reply