decoration decoration
Stories

GROKLAW
When you want to know more...
decoration
For layout only
Home
Archives
Site Map
Search
About Groklaw
Awards
Legal Research
Timelines
ApplevSamsung
ApplevSamsung p.2
ArchiveExplorer
Autozone
Bilski
Cases
Cast: Lawyers
Comes v. MS
Contracts/Documents
Courts
DRM
Gordon v MS
GPL
Grokdoc
HTML How To
IPI v RH
IV v. Google
Legal Docs
Lodsys
MS Litigations
MSvB&N
News Picks
Novell v. MS
Novell-MS Deal
ODF/OOXML
OOXML Appeals
OraclevGoogle
Patents
ProjectMonterey
Psystar
Quote Database
Red Hat v SCO
Salus Book
SCEA v Hotz
SCO Appeals
SCO Bankruptcy
SCO Financials
SCO Overview
SCO v IBM
SCO v Novell
SCO:Soup2Nuts
SCOsource
Sean Daly
Software Patents
Switch to Linux
Transcripts
Unix Books
Your contributions keep Groklaw going.
To donate to Groklaw 2.0:

Groklaw Gear

Click here to send an email to the editor of this weblog.


Contact PJ

Click here to email PJ. You won't find me on Facebook Donate Paypal


User Functions

Username:

Password:

Don't have an account yet? Sign up as a New User

No Legal Advice

The information on Groklaw is not intended to constitute legal advice. While Mark is a lawyer and he has asked other lawyers and law students to contribute articles, all of these articles are offered to help educate, not to provide specific legal advice. They are not your lawyers.

Here's Groklaw's comments policy.


What's New

STORIES
No new stories

COMMENTS last 48 hrs
No new comments


Sponsors

Hosting:
hosted by ibiblio

On servers donated to ibiblio by AMD.

Webmaster
Round Robin Valuations | 101 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Agree with above analysis
Authored by: Anonymous on Monday, November 05 2012 @ 06:13 PM EST
I think your analysis of the situation is fundamentally correct. It certainly
would explain many anomalies in the IT sector, particularly the behavior of many
American stock exchange listed companies.

[ Reply to This | Parent | # ]

Round Robin Valuations
Authored by: Anonymous on Tuesday, November 06 2012 @ 04:40 PM EST
Hey, there is really something to this!

During the 'tech boom' the Australian tax office changed the accounting rules
with respect to IP to 'bring them into line with international standards'.
Before they changed the rules, IP expenses (outgoings, i.e. real cash expenses)
were considered costs (liabilities) on a company's balance sheet and tax forms.
After the changes, those expenses were to be shown as 'assets', which is clearly
the opposite of business realities.

One effect of this was that small to medium enterprises immediately cut back or
eliminated licensing and patent applications - or even patent renewals (which
are expensive). I suspected at the time this was to give further advantage to
large foreign multinationals. Now I realize it gives a certain set of them an
(ultimately infinite) advantage for accounting purposes (selling of stock and
borrowing).

Think about it, the 'money' (book keeping entries) they have coming in from IP
licensing is shown as earnings, but the 'money' they have going out in IP
royalities is shown as an increase in assets! The book value of every company
involved in this round-robin scheme increases toward infinity even in the
complete absence of any actual sales. Nice work, if you can get it!

[ Reply to This | Parent | # ]

Groklaw © Copyright 2003-2013 Pamela Jones.
All trademarks and copyrights on this page are owned by their respective owners.
Comments are owned by the individual posters.

PJ's articles are licensed under a Creative Commons License. ( Details )