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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: Ken Muller who wrote (7515)	11/7/1997 11:01:00 AM
From: Ken Muller	Read Replies (1) \| Respond to of 14577

To All: The following is a part of a discussion on Motley Fool on 3 Com's NEW accounting problems. Looks like US Robotics and S3 were using the same accountants. << The actual nitty-gritty of the accounting gets into a lot of recondite issues such as revenue recognition that might explain to a large degree the extent of the sales shortfall for the two-month period. It appears that distributor-driven U.S. Robotics may have recognized sales when it shipped to distributors, whereas 3Com and its broader-based sales organization recognizes sales closer to when the product is actually in the hands of a customer. This alone could make millions of dollars in reported sales disappear overnight. Although Norris used the word "canceled" in his published column, alleging that U.S. Robotics had been stuffing the channel with inventory before it was purchased, the accounting issues are a little more convoluted, to say the least. Regardless, losing about $150 to $200 million in sales is not something most investors like to see. >> Ken