Gorilla and King Portfolio Candidates Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Gorilla and King Portfolio Candidates

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Uncle Frank who wrote (1567)	4/29/1999 5:24:00 PM
From: Grantcw	Read Replies (1) of 54805

Uncle Frank, I believe the accounting issue involved involves the method of acquisition accounting UNPH is using. In one method (pooling), no goodwill (the difference between the price paid for the company and its book value) is recorded in the acquisition and the new company is accounted for as if the two companies had been together since the beginning of time. The other method (purchase) forces UNPH to account for the combination as if they did indeed purchase JDS. They have to record goodwill in this method, and amortize (expense each year a certain amount) this goodwill over a certain time period. This amortization of goodwill can really kill a company's earnings. If you buy a company for a good amount and their book value is low, you can be forced to amortize millions over a relatively short amount of time, I think the largest amount is 40 years. Hope this helps, and I hope all of it's right. It's off the top of my head. See ya, Grant P.S. You aren't my real Uncle Frank, are you? Here's his work and picture if you don't know.<gggg> cbs.marketwatch.com

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next