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Technology Stocks : Siebel Systems (SEBL) - strong buy?
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To: Kitty Cat who wrote (2014)8/4/1998 11:26:00 PM
From: Melissa McAuliffe  Read Replies (1) of 6974
 
To the thread: Don't read this unless you are interested in this twelve month payment term issue. That's all it's about.

Kitty Cat,
I have to disagree completely on this. The new SOP is 97-2 which I hate to admit I actually read. (well at least the parts I was particularly interested in but I skimmed the rest of it anyway)

The primary reason for the 12 month rule in the first place had to do with likelihood of payments decreasing over longer periods due to technological obsolescense. Since this SOP is written for all software companies that makes sense.

But here's a verbatim quote from this SOP, paragraph #28:

"any extended payment terms may indicate that the fee is not fixed or determinable. Further, if payment of a significant portion of the software licensing fee is not due until after the expiration of the license or more than twelve months after delivery, the fee shuld be presumed not to be fixed or determinable. However,this presumption may be overcome by evidence that the vendor has a standard business practice of using long-term or installment contracts and a history or successfully collecting under the original payment terms without making concessions."

What this actually says is that even payments longer than twelve months could actually be booked. Though I would think most companies are adhering to the twelve month rule to be safe.

Unless I missed something I don't remember reading one thing about 30 days, 90 days or anything except twelve months so please let me know where it is if I missed it.
Melissa
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