Question

What is the relationship between PAT and non-recurring expenses?

Answer 1

If I can understand it in a right way, there is no relationship between Profit After Tax (PAT) and Non-recurring / Exceptional expenses (items). However, we must understand that presence of non-recurring expenses does not allow a true picture of profits and losses during the said period. hence, PAT which is meant to be Reported Net Profit here must be adjusted accordingly to reach Adjusted PAT (APAT); All the exceptional profits must be deducted and all the exceptional losses must be added back to the reported profit to arrive at adjusted profit.