The online service we love to hate performed some accounting gymnastics when the posted earnings for the last quarter and had to restate its third quarter results to reflect a loss.

Infamous for earnings trickery, America Online was forced by the Securities and Exchange Commission to restate last quarter's earnings when they were examined closely. At question was something AOL called "timing adjustments" that the company was using to spread termination expenses over several quarters. The SEC determined this practice was deceptive and forced AOL to restate the figures correctly. Using the new math, AOL actually lost $4.7 million in the third quarter.

The accounting adjustments should have no impact on fiscal 1997's full year results, the company said.

"It is important to note that the accounting changes we are making reflect timing issues, which do not impact AOL's strong operating momentum," said CEO Steve Case in a statement. Case is using an interesting definition of "momentum" apparently: Fourth quarter results for AOL were down $6 million from the same quarter a year before. Furthermore, AOL reported a fourth quarter loss of $11.8 million, or 12 cents a share. Advertising and commerce revenues, however, climbed 415% from a year before, reflecting AOL's strong userbase. During the quarter, AOL added 600,000 new members to reach 8,636,000 total members worldwide as of June 30, 1997, according to the company. AOL is the largest online service in the world