Companies have been using onetime charges to bury unfavorable expenses for years. Once again, I must caution that write-downs and charges are necessary and even good sometimes. Chronic chargers are really the concern here. Companies that use charges regularly to clear out the skeletons and hide management's missteps should be avoided. Often, expenses that would otherwise flow through the income statement lowering unadjusted net income are buried in these onetime charges.
Charges can be a red flag for mismanaged companies.
Spend some time looking for a pattern of chronic onetime charges. This is probably the most written about and at the same time, most brushed-off earnings distorter around. The danger is that these cash-rich companies lull us into complacency with their investment income and we lose focus on the underlying businesses. Even worse is the danger that management will lose sight of its fundamental job and become fixated on investment income to meet earnings goals. Below is a chart showing investment and interest income and gains for the three behemoths mentioned above.