Performance of large companies

Quarterly Bulletin 1988 Q4
Published on 01 December 1988

This article updates and revises estimates of company performance" taken from the published accounts of a sample of the largest UK companies, and is intended to complement and supplement estimates based on national accounts data.

The article concludes that, measured on the conventional historical cost basis, the performance of large companies continued to improve in 1987. The exceptional improvements in some sectors may have been exaggerated by accounting practices which reduce capital employed without a corresponding reduction in profits, such as the increased incidence of goodwill written off following acquisitions and the increased use of off-balance-sheet finance.

It remains impossible to produce meaningful analysis on a current cost basis as so few companies now report on that basis.

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