Business English

[JJsushi]

gummigut said:

EBIT and EBITDA are far from being BS American words, they are part of the beginning of valuation of companies and extremely common terms in Financial Management.

 

You and I both know that EBITDA is basically used as an accounting gimmick by management when cashflow and or profits are crap. I don't even think it is included in GAAP. Ever hear a CFO mention EBITDA when they have a kickass profit or unbelievable cashflows?

 

EBITDA has been abused for so long I don't even think people understand it's utilization. The way I learned it in uni vs the way i see it applied by management and analysts is worlds apart.

 

You can screw around with EBITDA but you cannot screw with cash flow. Granted EBITDA is an effective valuation tool in capital equipment intensive businesses. Warren Buffet always looks at the cash flows, none of that EBITDA nonsense. Sometimes in the financial world we tend to make matters too complicated and not use simple effective methods.

 

I clipped the following, I think #9 is the most important:

 

 

Top 10 Limitations of EBITDA

While many lenders, investment bankers and others involved in evaluating the financial performance of companies use EBITDA (earnings before interest, taxes, depreciation and amortization) as a cash flow measurement tool, it is important to recognize that EBITDA has its shortcomings. Here's the top 10 list of limitations of EBITDA developed by Moody's Investors Service.

 

1. EBITDA ignores changes in working capital and overstates cash flow in periods of working capital growth.

2. It can be a misleading measure of liquidity (quick access to cash).

3. It doesn't consider the amount of required reinvestment - especially for companies with short-lived assets, whether it's cable equipment or trucks.

4. It says nothing about the quality of earnings.

5. It's an inadequate stand-alone measure for a company's acquisition multiples.

6. It ignores distinctions in the quality of cash flow resulting from differing accounting policies - not all revenues are cash.

7. It's not a common denominator for cross-border accounting conventions.

8. It offers limited protection when used in indenture covenants.

9. It can drift from the realm of reality.

10. It's not well-suited for the analysis of many industries because it ignores their unique attributes.

[gummigut]

jj: You just love to hear yourself talk.

 

Those terms are not BS. They are used on Wall Street as part of the BEGINNING of valuation of companies.

 

If they are so gimmicky, than please tell me why they are often used in parts of valuations of companies by bulge bracket firms (Goldman, SSB/Citibank, JPM, MS, blah blah blah) and top PE firms?

 

It's a statistic. Not a be all and end all of valuation. It's not BS as they are used in presentations on Wall Street which generally doesn't put up with "gimicky". As I said, it's basically the BEGINNING of valuation of companies. Get a grip.

 

It's posts like these that detract from the whole point of the thread which is, yah don't really need to know much to teach what most people consider "Business English" here in Thailand. If Savittre was energetic enough to actually GO into a BOOK STORE with English learning material (as he said, he's taught English here a LONG time) then he could easily see that books like "Business Basics" is full of fluff that anyone can teach.

 

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[JJsushi]

gummigut said:

jj: You just love to hear yourself talk.

 

Those terms are not BS. They are used on Wall Street as part of the BEGINNING of valuation of companies.

 

If they are so gimmicky, than please tell me why they are often used in parts of valuations of companies by bulge bracket firms (Goldman, SSB/Citibank, JPM, MS, blah blah blah) and top PE firms?

 

It's a statistic. Not a be all and end all of valuation. It's not BS as they are used in presentations on Wall Street which generally doesn't put up with "gimicky". As I said, it's basically the BEGINNING of valuation of companies. Get a grip.

 

Don't give that "wall st" uses it stuff. Wall St is in the busines to make money and sell people things that they don't neccessarily need. Wall St is about generating revenue and profits for Wall St firms, they have to sell just as anyone else does and that includes using gimmicks. Wasn't it Wall St that invented the "eyeballs' and "mouse clicks" valuations of companies?

 

Come on Gummi you should know that Ebitda in one tool of many in valuations and 9 out of 10 times analysts and mannagers abuse it to make things look better than they are.

 

IIf u felt that the thread was going to ddetract, then why did you give your opinion that EBITDA is not BS?

[Nervous_Dog]

""then why did you give your opinion that EBITDA is not BS? ""

 

Because I imagine like most imperial facist terms used by business its important to "KNOW THE TERMS"rather than argue her over weather the term is relivant or not!

 

We could have whole arguements debating accounting practices, should incentives such as share's option be taxed at what rate and part of a companies financial liabilities,

 

But that's not what thread is about,

 

It's about TEACHING ENGLICH (maybe I should sign up as a student) and the terms used in business,

 

now if it was a ethics class that would be something different

 

DOG - fart

[Flashermac]

Tell me about it, Manfred! My effing university told me I was too old and said "Thank you, sod off". Then they turned around and replaced me with an American LAWYER with no teacher training of any kind, let alone ESL. (If he's any good as a lawyer, why is he teaching English for peanuts in Asia?) They've also assigned a new gal with all sorts of basic ESL training to teach Creative Writing! (Supposed to be short story writing, but I hear she's told them to create a magazine and sits and watches 'em.) You know my uni, so you know it allegedly is one of the best! (It really is ... the others are forked up even worse.)

 

Oh, yeah ... after "retiring" me (minus any benefits), the govmt has changed its policy. So now they have retained a colleague who just hit 60. His background ... uh social work. They told him he can stay to 65.

 

Thai logic is straight out of Alice in Wonderland.

 

::

 

 

p.s. You may remember I've been a journalist, full time and part-time. So a few years ago when I saw an untaught course called English for Journalism in the curriculum, I asked to prepare and teach it. No reply at all from the Dept head. A bit later I see a colleague downloading all sorts of crap from the internet, which is the way he "prepares". I asked what he was doing. He said, "The dept head asked me to prepare and teach the English for Journalism course." I replied, "You've never been a journalist. You don't know anything about journalism." He answered, "I know." And his lesson #1 in the class? Feature writing!!!

[Guest]

it's rather funny at times how people can rise here in society. a couple of years back a shady mate of mine made a meteorlike rise in thai society. mindblowing.

that bloke was a slimy, but amusing character. his background included used car salesman (that was the cleanest job he ever had).

he arrived without a penny, started the hotel city map scam to get him some funds. then he realised that his talents are very sought after in this place, and within a few months he worked directly for a deputy prime minister, and then for a bunch of generals juggling around dirty moneys.

 

some of those contacts he made while teaching them "business" english... ::

[lembeh]

 

>those are american BS words

 

Not being an English teacher, and far be it from me to correct any buisness people on the board, one would have to note howeve, that, as far as I can see, those are not "words" they are "acronyms"....

-j-

[gummigut]

"If u felt that the thread was going to ddetract, then why did you give your opinion that EBITDA is not BS?"

 

I wasn't clear. What I thought was distracting from the thread was your response about the limitations of the term and your life experiences which was in direct response to my statement that EBITDA is not a BS term but part of the BEGINNING of valuation.

 

Your response was long and out of proportion to my assertion. In fact, it doesn't even negate my assertion as I never said anything about the validity of EBITDA exept that it is not a BS gimicky term. Thus your long response was unwarranted.

 

By comparison, my post that EBIT and EBITDA were not BS terms was extremely short. My proof was a one liner stating that the terms are used in the beginning of valuation, thus they have value (if limited).

 

I can further criticise the points in your most recent post.

 

"Wall St is in the busines to make money and sell people things that they don't neccessarily need." Yes, but I wasn't talking about retail. I was talking about corporate IB, which is why I also said PE (private equity) firms. I could have also said venture capital. These types of presentations are made to astute investors.

 

So, if EBITDA and EBIT are still used as valuation stats (a stat, not a be all and end all, but one point of info. among many) by financial professionals to sophisiticated private and institution investors then by definition it's not BS nor gimicky.

 

As for gimicky... "Wasn't it Wall St that invented the "eyeballs' and "mouse clicks" valuations of companies?"

 

Of course, but that was because it was faced with valuing something that had no precedent. The bubble did burst and where are those terms now and how are they used?

 

EBIT and Ebitda by comparison have been around for much longer and have been scrutinized for its shortcomings but they are STILL used and will continue to BE used. Which is the point of why we studied it in college and why kids today still study it.

 

Finally, after all that stuff, back to the topic of business english.

 

You can get a bit more for offering Business English classes. I think much more interesting topics would be critical reading and writing. Can also get more money for those classes but then you actually have to prepare good material as opposed to business english classes which focus on how to understand and give directions to an office building/room, travel reservations, and how to order a meal in a restaurant.

 

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[Savittre]

Thank you all for your replies!

[elef]

Hi josh_ingu,

 

acronyms are also words,

 

but OK let me correct "those are american BS acronyms" or "corporate BS" as an american friend says. ::