Net Profit

I. Formal Definition

The income remaining after all expenses, including operating expense, interest, taxes, and any one-time items, are deducted from revenue. Net profit is the bottom-line measure of profitability and is the GAAP residual that flows to retained earnings or to dividends. The federation requires net profit to be reported on a GAAP basis with non-GAAP reconciliation only as supplementary information under UFMS-001:3.2. Reclassifications affecting prior period net profit are disclosed and quantified, and the impact on EPS is footnoted.

II. Etymology

A standard term of double entry accounting; the construction stabilised in the standardised income statement format of the late nineteenth century corporation.

III. Federation Usage

Federation members publish GAAP net profit with non-GAAP reconciliation as supplementary. Prior period reclassifications are footnoted with EPS impact. Net profit feeds the IFO4 Score profitability component under MEV-Annex:4.1.

IV. Related Terms

• ebitda
• operating-margin
• free-cash-flow-margin
• gross-profit

V. Authoritative Citations

• UFMS-001:3.2UFMS Article III - Net Profit
• MEV-Annex:4.1MEV Annex IV - Net Profit Reporting

VI. Citation in BibTeX

@misc{ifo4_glossary_net_profit,
  title        = {{Net Profit}},
  author       = {{IFO4 Federation Editorial Board}},
  howpublished = {{IFO4 Federation Glossary, slug \texttt{net-profit}}},
  year         = {2026},
  url          = {https://ifo4.org/glossary/net-profit},
  note         = {Category: Unit Economics; key: NetProfit}
}

VII. Challenge This Definition

Federation members and accredited practitioners may challenge any entry under TGS-002:1.7. Filed challenges are routed to the editorial board, triaged into the revision register, and resolved in writing on the public docket. The slug remains stable through any revision.