I don't agree with this sentence at all, "If there is a better way to judge the true financial prospects of a company we should be taxing them accordingly."

The main thing investors want are some measures that are reasonably forward looking, with the caveat that some of those forward-looking measures will of course be inaccurate when the future comes.

Taxes, on the other hand, should be mostly past looking, taking into account events that are fully settled and guaranteed.

If, as an investor, you're only examining trailing metrics, you're going to be a pretty horrible investor.

It's actually an interesting question as to whether something different from GAAP should be used for tax. For companies based in one country it's a time honoured system that has worked for decades but for multinationals it's become in my opinion too easy for them to use loopholes and pay little or no tax.

Like with YC they are US based and if they sell their dropbox stake they'll be taxed but more tax avoiding companies might say have held the dropbox stake through a Cayman Islands trust or some such and try avoiding it. I'd vote for something like for multinationals they do accounts as if all their multinational bits were in one country and then allocate the earnings to different countries in proportion to the sales there. So if Microsoft had a lot of Windows sales in Germany say they'd pay tax on the profits there rather than saying they were all generated at a DVD stamping plant in Ireland for example.