The CFO of USA Networks Inc. has found a way to break free of the dreaded earnings-expectations game with Wall Street. Along with the release of its third-quarter results on October 24, the New York- based media and commerce company disclosed its internal operating budget–yes, its entire annual plan through 2003, division by division–which prompted CEO Barry Diller to proclaim that USA would no longer participate in the “Kabuki dance” of guiding analysts.

“We think this is a better way of providing information,” says CFO Mike Sileck. “We let analysts see our budget, which by definition is our best indicator of future activity, and we stop wasting time and energy on the game.”

Most companies come up with internal goals and expectations, “and then water them down and give them out as earnings guidance,” asserts Sileck. Observers confirm that executives regularly set the expectations bar low so that earnings exceed the number and garner a positive reaction from Wall Street. “That’s a process we’ve chosen not to participate in,” says Sileck.

Analyst Gordon Hodge of Thomas Weisel Partners LLC calls USA’s move “very bold and honest” and “the right thing to do,” especially since it allows analysts an opportunity to really understand the assumptions embedded in the business plans. “If we’re doing our jobs,” he says, “we can take the pulse of the marketplace and decide whether those plans can be met.”

Sileck expects to field questions from analysts about major events or updates, but in keeping with his general practice, he won’t provide interim comment. “Each quarter, we’ll release our full results,” he explains, “and if we think the balance of the year will be better or worse, then we’ll update, just as we do internally.”

Senior executives at other companies may worry that similar budget releases will put useful information in the hands of competitors, notes Hodge. Hence, they probably won’t follow USA’s lead. Still, Hodge believes the company is at the forefront of “the disclosure curve.”