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Technology Stocks : Siebel Systems (SEBL) - strong buy?
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To: APPTRADER who wrote (2005)7/31/1998 4:05:00 PM
From: Melissa McAuliffe  Read Replies (1) of 6974
 
I find it very hard to believe that if payments are not scheduled to be received within 90 days they are going into deferred revenue. Isn't the accepted policy industrywide 12 months? Personally I think that if Michelle Axelson was using 90 days she was being just too conservative. I mean there's conservative and then there's CONSERVATIVE. As long as the company feels these payments will be collected why not follow the 12 month rule. That rule was put into effect to be conservative in the first place. Maybe the size of the scop contracts was small enough that it was reasonable to collect the majority of the paymetnts within 90 days.

However, I seriously doubt on these $1M+ contracts that they payments are all going to be received within 90 days...even 500K contracts for that matter. .I'd be totally surprised if this were the case. I'd also be surprised if Howard Graham is deferring anything over 90 days. Obviously I don't know whether he is or not but it just wouldn't make sense if you have a perfectly clean contract with payments extending 12 months. If Howard is doing this I would think that sebl's deferred revenue woud be a lot larger. I don't care how good they are at negotiating, it's just not that easy to get 90 day payment terms on sizeable contracts.
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