Hi, PTK - One of the little mysteries of DMX that I've always wondered about is the falling-out between Ernst & Young, and DMX. It appeared to revolve (from what I was able to learn) around the Oxo Chemie acquisition.
Looking at the financials, I was never able to see what caused the rift; perhaps now, it's clearer.
"The accounting rules in both the US and Canada are quite clear regarding how acquisitions of entities MUST be treated. There are no ifs, ands or buts, about these rules...you either do them or you will be deemed to be in non-compliance of GAAP...The "ma and pa shop" mentality of DMX seems to be resurfacing once again."
IYO, would differences over the method of accounting for the acquisition have been sufficient grounds to explain the split?
The non-standard accounting - does it just seem the result of a "ma and pa shop mentality" (which I take to mean a certain bullheaded amateurishness) - or does it reflect, possibly, some other intent?
Not suggesting anything devious here, but looking at the consequences of that accounting decision - the split with E&Y possibly, a variance significant enough to put DMX at odds with the OSC, and finally, a roadblock (however temporary) to the RO - it seems to have been an extremely unwise decision. What could have motivated it?
Any thoughts?
Jim |
