The BEA released corporate profits for Q1 2012 along with the GDP. Corporate profits after tax are through the stratosphere, up 10.1% from Q4 2011 to $1,644.9 billion for Q1 2012. Corporate profits after tax are also up 13.1% from a year ago.

Corporate profits with inventory valuation and capital consumption adjustments, after tax, decreased -5.7% from last quarter to $1,486.5 billion but are up 2.2% from one year ago. Quarterly tax receipts increased for Q1 by $83.3 billion.

Corporate profits with inventory valuation and capital consumption adjustments, pre-tax, decreased $6.4 billion to $1,980.5 billion, or -0.3% from Q4 and still up 5.5% from a year ago. These are profits from current production.

Net cash flow, with inventory evaluation adjustment declined –6.5% from Q4 to $1,768.9 billion.

It's pretty clear corporations are busy squeezing workers, as usual. Gross value added is production, or output of a company minus the inputs, or consumption it uses to make that output.

In the first quarter, real gross value added of nonfinancial corporations increased 3.8 percent. Profits per unit of real product increased, reflecting an increase in unit prices and a decrease in unit labor costs; unit nonlabor costs were unchanged.

The BEA reports corporate profits in a variety of ways and it seems whatever one's focus and political predilections are implies which number they use.

From the BEA's magic secret decoder ring guide to National Income and Product Accounts (large pdf), national income also uses inventory valuation and capital consumption adjustments. Their reasoning for inventory valuation is this:

Inventory valuation adjustment (IVA) is the difference between the cost of inventory withdrawals valued at acquisition cost and the cost of inventory withdrawals valued at replacement cost. The IVA is needed because inventories as reported by business are often charged to cost of sales (that is, withdrawn) at their acquisition (historical) cost rather than at their replacement cost (the concept underlying the NIPAs). As prices change, businesses that value inventory withdrawals at acquisition cost may realize profits or losses. Inventory profits, a capital-gains-like element in business income (corporate profits and nonfarm proprietors’ income), result from an increase in inventory prices, and inventory losses, a capital-loss-like element, result from a decrease in inventory prices.

The mysterious capital consumption adjustment, along with inventory valuations, derives current production income.

The private capital consumption adjustment (CCAdj) converts deprecia­tion that is on a historical-cost (book value) basis—the capital consump­tion allowance (CCA)—to depreciation that is on a current-cost basis—consumption of fixed capital (CFC)—and is derived as the difference between private CCA and private CFC.

Since this is what the BEA uses for national accounts and makes much more sense from a business accounting perspective generally, seems the above before and after tax numbers are the right metrics to use when thinking about corporate profits from a national and macro-economic perspective.

That said, the general corporate profits after tax shows another story, namely workers make less, corporate profits are at an all time high and there are fewer workers, especially if one focuses in on U.S. citizens, than ever before.

Here is the report text on corporate profits after tax and the dollar amount breakdowns of the differences between profits reported.

Profits before tax increased $234.3 billion in the first quarter, in contrast to a decrease of $8.3 billion in the fourth. The before-tax measure of profits does not reflect, as does profits from current production, the capital consumption and inventory valuation adjustments. These adjustments convert depreciation of fixed assets and inventory withdrawals reported on a tax-return, historical-cost basis to the current-cost measures used in the national income and product accounts. The capital consumption adjustment decreased $230.4 billion in the first quarter (from $100.9 billion to -$129.5 billion), compared with a decrease of $1.8 billion in the fourth. The inventory valuation adjustment decreased $10.4 billion (from -$18.6 billion to -$29.0 billion), in contrast to an increase of $26.9 billion.

If the above magic secret BEA decoder ring didn't make much sense, try this one:

Corporate profits with inventory valuation and capital consumption adjustmentsis the net current-production income of organizations treated as corporations in the NIPA's. These organizations consist of all entities required to file Federal corporate tax returns, including mutual financial institutions and cooperatives subject to Federal income tax; private noninsured pension funds; nonprofit institutions that primarily serve business; Federal Reserve banks; and federally sponsored credit agencies. With several differences, this income is measured as receipts less expenses as defined in Federal tax law. Among these differences: Receipts exclude capital gains and dividends received, expenses exclude depletion and capital losses and losses resulting from bad debts, inventory withdrawals are valued at replacement cost, and depreciation is on a consistent accounting basis and is valued at replacement cost using depreciation profiles based on empirical evidence on used-asset prices that generally suggest a geometric pattern of price declines. Because national income is defined as the income of U.S. residents, its profits component includes income earned abroad by U.S. corporations and excludes income earned in the United States by the rest of the world.