Paul --
Regarding how much the Compass acquisition may have contributed to the bloating in A/R, I found this in Avant!'s filing on Edgar:
(b) All of the accounts receivable and notes receivable, net of allowances, owing to Compass as of June 27, 1997 and as of the Closing are, or will be, set forth in SCHEDULE 3.6 or an updated SCHEDULE 3.6 delivered at the Closing, respectively, and constitute, and as of the Effective Time of the Merger will constitute, valid and enforceable claims arising from bona fide transactions in the ordinary course of business collectible in the recorded amounts thereof, to the extent not previously collected (provided further that this representation regarding collectibility of accounts shall be breached only to the extent the sum of all uncollectible accounts exceeds the allowances in the balance sheet as of June 27, 1997 in the Compass Financial Statements or allowances made in the updated SCHEDULE 3.6 delivered at the Closing, which allowances have been and shall be calculated in a manner consistent with the methodologies and practices used by Compass in preparing its balance sheet as of December 27, 1996), and, there are no known, contingent or asserted claims, refusals to pay, rights of return, or other rights of set-off against any thereof. As of the date hereof, and as of the Closing, there is and will be no account receivable or note receivable that is pledged to any third party by Compass.
I haven't yet found the schedules referred to above. But these should tell us just how much Compass contributed to the increase in receivables.
FYI, as of today's report, I show Avant!'s DSOs at 70 days. Has it ever been that high before?
- Peter B |
