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Technology Stocks : Corel Corp. -- Ignore unavailable to you. Want to Upgrade?

To: B. Carrington who wrote (4889)	3/2/1998 12:59:00 AM
From: Wizzer	Read Replies (1) \| Respond to of 9798

I actually was talking about the class action suit that has already been filed and how the substance of the class action was similar to my raging bull posts that Kurt brought over. It would not surprise me, as one of your posts indicates, that Corel might go after their auditors (it's not our fault it's the auditors fault kind of scenario). Some others have pointed out that 'sales in' (product sent to distribution channels) counting as revenue is not unusual in software companies. This would indicate that Corel, as part of previous revenue, counted 'sales in' as revenue, and thus previous financial statements were also inflated. The 1997 write-offs must have been included as revenue in previous financial statements. Also the cost of creating the software plus selling, advertising etc... would have been included. I believe that the write-offs of software were calculated at full value (write-off full value when software is essentially worth nothing). 'Sales out' (physical sales to customers) is the only valid revenue recognition and it surprises me that it has taken this long for them to realize this. What does surprise me is that Corel fell into the same trap as other companies did and are now paying the price. What also surprises me is that the stock has NOT gone down considerably with threats of lawsuits (real and rumour). I think other stocks would have taken a harder hit especially with Corel's poor 1997 results. Volume of trades is still high also so someone must be buying for a reason.