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Technology Stocks : THQ,Inc. (THQI)
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To: Jeff Bond who wrote (9531)2/1/1999 5:06:00 PM
From: AreWeThereYet  Read Replies (1) of 14266
 
I am not an accountant but here is my thought about POI vs Purchase:

Kory has already show us how POI/Purchase works wrt to the books.

POI is the prefer way if the two companies are both similar size or very large. Purchase method is usually happen when a big company buyout a small company. eg) Cisco take-over XYZ Boardband Inc. for 10 million. I could be wrong, I believe NOL (if any) cannot carry forward with the Purchase method, it has to be "write-off".

For POI, there is merger related charge too, the prefer way is to write-off as much and as soon as possible if permit. So it won't affect future earnings.

That's about all I can say, hope it won't confuse you :o)

aC
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