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Technology Stocks : Lucent Technologies (LU)
LU 2.8200.0%Nov 7 9:30 AM EST
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To: Chuzzlewit who wrote (11227)11/19/1999 5:01:00 PM
From: Mr.Fun  Read Replies (2) of 21876
 
Chuzz,

I believe that I have misinterpreted your statements, so let me be clear - The Saudi item was properly moved from AR to Other Current Assets. The $600M decrease in AR was completely offset by a corresponding increase in Other Curret Assets yielding zero (0) impact on operating cash flow. I did not intend to confirm that LU was considering this a net addition to operating cash, rather I intended to confirm that the corresponding increase did offset the other balance sheet entry. As such, there is no "gimickry" and no reclassification of cash flow from operating to investment or vice versa.

I too spend many hours parsing through financial statements. I believe that many poorly informed analysts have used a cursory read of LU's statements to level unfounded accusations of "accounting gimickry". There are many reasons as to why balance sheet items change - before you offer serious charges of deliberate manipulation of financial statements, I ask that you give full consideration to the balance sheet in the context of the companies performance. Finally, why do you suspect that LU has lied about its operating cash flow in a published press release given that its year end financial statements will be audited by a supposedly professional and impartial accounting firm?
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