Well I missed. I figured they would try to capitalize or otherwise not count free shipping. But not counting payroll, that's a new one. Kudos!
John,
They've done that for three straight quarters. It's just taken that long for people to figure it out. (Except for Sam, who had it nailed months ago.)
NS
Gary,
Can someone explain why Overstock changed its revenue accounting in the fourth quarter? The press release says it was a result of an SEC inquiry.
When I took entry level accounting over 20 years ago, it was clearly explained that you record sales when title passes. If title doesn't pass until the buyer gets it, then you can't record the revenue. Why did it take Overstock seven years to figure that out? Are Chidester and Lindsey, the only 2 CFOs they've ever had, that incompetent?
They could have just hired a few sophomore college students to help them out with that one.
If they can screw something up that simple, it makes me wonder what other problems are there to find?
NS
Is is no big surprise that Bryne would attempt to stack the deck in his favor as a condition of allowing Sam Antar on the call. The last thing Byrne wants, or can afford, is to meet Sam Antar on level ground.
Can't help but wonder if the numerical shenanigans was the cause of Lindsay's sudden exit.
NS.."you record sales when title passes".
Funny, Wall Street books commissions without settling trades and nobody seems to have issue with that.
As for "The press release says it was a result of an SEC inquiry", that is typically what happens when the SEC comes in and raises questions about accounting methods used. Many times teh SEC identifies methods they think should be changed but also find that the Company did not do it in any manner of fraud.
Jim.
The accounting change shows that Overstock accounting doesn't have a clue what it is doing. That was a very elementary mistake. What other "mistakes" have they made that might overstate profit?
The fact that it came from SEC comments also means the SEC inquiry of Overstock is still alive and moving forward.
NS
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