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Microcap & Penny Stocks : Zulu-tek, Inc. (ZULU) -- Ignore unavailable to you. Want to Upgrade?

To: Terry T. who wrote (7081)	5/16/1998 2:03:00 AM
From: Jon Tara	Read Replies (1) \| Respond to of 18444

Terry, I doubt that the revenues were blatently mis-stated. That is, I doubt that they said "$39M" and it's really, say $20M. (If so, though, this boat is sunk.) If there is a problem with revenues, I suspect it would have something to do with "captive sales", something that was brought-up in one of the lawsuits. Were sales to Ziff-Davis and other Softbank units done at competitive rates? Or were they inflated? Were they booked at a higher rate than sales to other customers? Were other customers afforded discounts while the Softbank units were not? I suspect their could be some complications in accounting for these sales to other units of the same company and some special accounting rules with regard to the sale of SIM to ZuluTek. (Of course, these sales are also an issue when looking at revenues going forward, but that's a different issue. What percentage of the sales were to other Softbank units, and what percentage were to others? And what percentage of those sales were retained after the sale?) Any accountants here?