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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: Johnnie Memmonic who wrote (16102)	10/1/1999 6:42:00 AM
From: signist	Read Replies (1) \| Respond to of 42804

What the SEC Does The U.S. Congress created the SEC in 1934. Awakened by the Great Crash of 1929, our country decided that for capitalism to flourish, we needed to protect investors from fraud and unfair sales practices. Since 1934, as our markets have grown and changed, our laws and the regulations adopted by the SEC have kept pace with Wall Street. Although complex, these laws and regulations boil down to a couple of very simple and common sense notions: People who seek your investment dollars must tell you the truth about their businesses. By contrast, SFAS No. 131 requires that a company provide for each reportable segment quantitative disclosure of two basic items - total assets and a measure of profit or loss. The new standard defines neither segment profit (loss) nor assets. Instead, management must determine what they will report based on how they operate their business. In addition, companies must disclose the following items for each segment, but only if management includes them in measuring segment profit or loss: * revenues from external customers; * revenues from other operating segments; * interest income;[20] * interest expense;[21] * depreciation, depletion and amortization; * unusual items; * equity in net income of equity method investees; * income taxes; * extraordinary items; and * significant non-cash items other than depreciation, depletion, and amortization. A company also must disclose for each segment the amount of investment in equity-method investees and total expenditures for additions to long-lived assets if it includes the amount in its determination of segment assets.[22] The company must reconcile the totals of the reportable segments' amounts for all of these listed items to consolidated amounts. The FASB required more items to be disclosed per segment under the new standard because analysts have long wanted more information and most of the items required should be already available in management reports. Today we are amending our narrative and financial reporting rules to conform their segment reporting requirements to the FASB's revised accounting standards. We retain, however, certain requirements relating to disclosure of principal products or services and major customers that traditionally have differed from the FASB standards.[23] We address below each of the rule changes.[24] 1. Description of Business - Item 101 In the past, Regulation S-K Item 101(b)[25] required issuers to disclose in the business description sections of documents that they filed with the Commission financial information based on GAAP's old "industry segment" standard. Under revised Item 101, registrants will report segment information in accordance with GAAP's new operating segment standard.[26] Other changes to Item 101 follow. a. Principal products or services Item 101 historically has required a discussion, by segment, of the principal products produced and services rendered by the issuer, as well as the principal markets for and methods of distribution of each segment's products and services. On the other hand, GAAP required, and continues to require, disclosure of the types of products and services from which each segment derives its revenues, without reference to principal markets and methods of distribution. We continue to believe that information relating to principal markets and distribution methods is useful to investors; consequently we are retaining this provision. Item 101 further requires registrants to disclose the amounts of revenues from each class of similar products and services based on quantitative thresholds. Specifically, the issuer must state the amount or percentage of total revenue contributed by any class of similar products or services that accounted for 10 percent or more of consolidated revenue in any of the last three fiscal years, or if total revenue did not exceed $50,000,000 during any of those three fiscal years, 15 percent or more of consolidated revenue.[27] SFAS No. 131 requires disclosure of revenues from external customers for each product and service or each group of similar products and services unless it is impracticable to do so. Because SFAS No. 131 requires disclosure regardless of amount, unless impracticable, it appears that the new accounting standard may require more disclosure than Item 101. Consequently, we sought public comment as to whether we needed to maintain the quantitative thresholds of Item 101(c)(1)(i). Several commenters advocated eliminating the quantitative thresholds and simply relying on the GAAP standard, which they said implied a materiality standard for minimum disclosure. We believe that SFAS No. 131 will result in disclosure of a range of amounts of products and services, depending upon how a company defines a class of related products or services. In fact, SFAS No. 131 may require disclosure of amounts below the existing 10% threshold of Item 101. We believe a clearly stated minimum threshold for disclosure is desirable to eliminate any possible ambiguity that may result from attempts to apply an unwritten materiality threshold to small amounts of reportable revenues and is in keeping with the 10% threshold used to report segments under SFAS No. 131. We therefore have retained these Item 101 thresholds. edgar.sec.gov There seems to be a rule that allows confidential filings of information (if properly filed) We may never find out details of our investment in NAC but IMO the financial gain or loss should show up on the annual or quarterly. John Any informed person wishing to comment regarding disclosure responsibilities are welcome!