１．earnings are relieved of charges necessary to bring these assets down to realizable values.
２．earnings are relieved of charges necessary to bring the provisions or liabilities up to their market values.
Example are understatements in provisions for product warranties and environmental liabilities that yield overstatement in cumulative earnings.
３．an overprovision for current and future liabilities or losses yields an understatement of earnings ( or overprovision of losses )
４．Bearing in mind our propositions regarding the earnings effects from reported values of assets and liabilities, the critical analysis of these values represents an important factor in assessing earnings quality.