Odd thought

[avevale_intelligencer]

Profit (to an individual or a small corporation): money you need, i.e. to feed yourself and family after you've paid your bills.

Profit (to a large corporation): money you don't need, i.e. what's left to give your shareholders and finance your directors' jollies after you've paid your expenses.

Clearly some corporations are very small and in these cases there's some overlap. Equally clearly, there's a cut-off point beyond which profit becomes more than anyone could need. Also, corporations don't eat.

Comments

[keristor.livejournal.com]

No, profit to anyone is defined as what is left after all bills, including for food/rent/etc., have been paid. (It may be divided into "pre-tax" and "after tax", or 'gross' and 'net' profit, and the calculations of "pre-tax" for individuals and for companies are not the same, but the definition is the same. For net profit taxes are counted as bills.)

Corporations do have to pay property taxes and/or rents, maintenance, depreciation and replacement of machinery, etc. And their shareholders are people who have put their own money into backing the venture, they need to eat and live as well and get back what they have paid to the corportation (plus extra) otherwise no one will ever put money into them to get started.

I agree that paying shareholders and managers billions of pounds (aggregate, not each!) after accepting a bailout from public funds (i.e. taxpayers) is wrong, it should be treated like any other loan and come first (eg. if they accepted a bailout of 6bn then that should be deducted directly from their declared profits).

[zanda-myrande.livejournal.com]

Corporations pay tax? Small ones, maybe. The big ones don't.

[redaxe.livejournal.com]

corporations don't eat

Not corn, or venison, or algae. But tell that to smaller companies devoured (and whose corporate culture undergoes, at least, a microscopic examination) by large ones. Or large ones devoured by huge ones.

Also, too, profit is the sole chartered purpose of most corporations (usually written as "benefit to stockholders"). Note that I don't assert it's the only legitimate purpose -- my opinion is that it's not -- but under the law of the land, that's the one and only. (Hey, working for investment banks for fifteen years l'arns ya something!)

[the-magician.livejournal.com]

Though, to be fair, some corporations/companies are set up and controlled by a Board that agrees with the shareholders that part of the purpose of the company is to behave ethically, responsibly, invest in places with lower profits in order to benefit portions of mankind etc.

For example the Co-operative Banking group in the UK includes ethical business and impact on the environment as part of the "benefit to shareholders" and not just pure cash.
In a world where the traditional financial services model has been tested and found wanting, the Co-operative Financial Services (CFS) is proud to be different. As a member-owned, customer-led and ethically-guided business, CFS has increasingly differentiated itself by its prudent financial stewardship, its consistent approach to customer service and its concern for its impact, not just on customers but on communities and the environment as a whole

For a small business, profit is the money left over after all the expenses (including taxes) has been paid for. For an individual I have no concept of a profit, though if I buy something for £10 and sell it for £20, then I'd consider that a £10 profit, because I don't count my time, my travel costs, my storage costs etc. I have income and outgoings, and I either incur debt or (at the moment) reduce debt ... with some prudence I hope to move into "create savings" but I don't think I'll ever "produce profit".

[pbristow.livejournal.com]

I'm afraid I don't recognise that first definition at all. Profit - for company or individual - is what's left after you've paid all the expenses necessary to sustain the activity that may or may not have produced the profit in question.

(Ob. David Gunson (roughly, from memory): "Pan Am was the only airline in the last few years that didn't make a loss, and that was all thanks to their innovative accountancy methods. Pan Am... made a *negative profit*. [PAUSE FOR LAUGHTER] Now we've gone for this in a big way, and as of [DATE], British Airways is exactly 72 million pounds in a negative profit situation." [PAUSE FOR AUDIENCE OF (MOSTLY) BANKERS TO RECOVER THEIR BREATH AND/OR SOBRIETY, AND/OR FINISH HAVING THEIR HEART ATTACKS AND QUIET DOWN SO THAT EVERYONE ELSE CAN ENJOY THE REST OF THE SPEECH.)