Go to Jeff Salisbury LWGate Home Page.From: "Tom Worley" <stkguru@netside.net>
Subject: Re: [CANSLIM] PSFT: More accounting shenanigans?
Date: Tue, 22 Jan 2002 11:52:20 -0500
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so, how can small investors detect, much less avoid, these kinds of =
slick tricks?
Tom Worley
stkguru@netside.net
AIM: TexWorley
----- Original Message -----=20
From: Katherine Malm=20
To: canslim@lists.xmission.com=20
Sent: Tuesday, January 22, 2002 11:45 AM
Subject: [CANSLIM] PSFT: More accounting shenanigans?
Once more into the fire. Think this will become the "year of the =
accounting case study."
--Katherine
This from Briefing.com
Archives In Play=AE all dates =20
Date (ET) Archive Article=20
Jan 22 2002
11:06 AM In Play PeopleSoft (PSFT) 33.45 -1.89 (-5.4%): -- =
Update -- This is not the first time that concerns about accounting at =
the Momentum unit have been brought to light. On Jan 2, Briefing.com =
reported a Lehman defense of the stk following a 12/31 Bloomberg article =
indicating that PSFT might repurchase its Momentum Business Applications =
unit to avoid paying royalties. Lehman predicted that PSFT was likely to =
purchase Momentum for about $90 mln within the next few qtrs. Firm did =
not think there were accounting irregularities and viewed the issue as =
likely overblown.=20
Jan 22 2002
10:53 AM In Play PeopleSoft (PSFT) 34.37 -0.97 (-2.7%): =
- --Update-- According to the San Jose Mercury article, PeopleSoft hired =
that subsidiary, Momentum Business Applications, to write new software, =
and Momentum, in turn, hired PeopleSoft programmers at a markup. The =
arrangement transformed the high cost of creating new programs into a =
source of revenue for PeopleSoft.=20
Jan 22 2002
10:49 AM In Play PeopleSoft (PSFT) 34.32 -1.02 (-2.9%): =
Accounting concerns again putting pressure on PSFT shares. The San Jose =
Mercury News reports that an accounting maneuver by former PSFT head =
allowed company to avoid crushing development costs. Six months before =
stepping aside, PSFT co-founder David A. Duffield transferred $250 =
million to a newly created subsidiary with just one employee and an =
office down the road from PeopleSoft headquarters. Peter Knutson, an =
associate professor emeritus of accounting at the University of =
Pennsylvania's Wharton School, believes the arrangement misled =
investors: 'It is within the boundaries of generally accepted accounting =
principles, but it is really an intent to deceive.'
=20
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<DIV><FONT face=3DArial>so, how can small investors detect, much less =
avoid, these=20
kinds of slick tricks?</FONT></DIV>
<DIV> </DIV>
<DIV>Tom Worley<BR><A=20
href=3D"mailto:stkguru@netside.net">stkguru@netside.net</A><BR>AIM:=20
TexWorley</DIV>
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<DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dkmalm@earthlink.net =
href=3D"mailto:kmalm@earthlink.net">Katherine=20
Malm</A> </DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A =
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Tuesday, January 22, 2002 =
11:45=20
AM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> [CANSLIM] PSFT: More =
accounting=20
shenanigans?</DIV>
<DIV><BR></DIV>
<DIV>Once more into the fire. Think this will become the "year of =
the=20
accounting case study."</DIV>
<DIV> </DIV>
<DIV>--Katherine</DIV>
<DIV> </DIV>
<DIV> This from Briefing.com</DIV>
<DIV> </DIV>
<DIV>
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<TD class=3Dcat vAlign=3Dtop width=3D669><B>Archives </B>In =
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all dates</TD>
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<TD class=3DtdG noWrap width=3D"12%">Date (ET)</TD>
<TD class=3DtdG noWrap width=3D"10%">Archive</TD>
<TD class=3DtdG noWrap =
width=3D"78%">Article</TD></TR></TBODY></TABLE>
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<TR>
<TD class=3Dtd4g vAlign=3Dtop noWrap width=3D"12%">Jan 22 =
2002<BR>11:06 AM</TD>
<TD class=3Dtd7g vAlign=3Dtop width=3D"10%" rowSpan=3D2><A =
class=3Dtd7g=20
=
href=3D"http://www.briefing.com/scripts/ArchCal.asp?ID=3DIN"><FONT=20
style=3D"BACKGROUND-COLOR: #eaf4f1" color=3D#000000>In =
Play</FONT></A></TD>
<TD class=3Dr2 width=3D"78%" rowSpan=3D2>PeopleSoft (PSFT) 33.45 =
- -1.89=20
(-5.4%): -- Update -- This is not the first time that concerns =
about=20
accounting at the Momentum unit have been brought to light. On =
Jan 2,=20
Briefing.com reported a Lehman defense of the stk following a =
12/31=20
Bloomberg article indicating that PSFT might repurchase its =
Momentum=20
Business Applications unit to avoid paying royalties.=20
Lehman predicted that PSFT was likely to purchase =
Momentum for about $90 mln within the next few qtrs. Firm did =
not think=20
there were accounting irregularities and viewed the =
issue as=20
likely overblown.</TD></TR></TBODY></TABLE>
<TABLE cellSpacing=3D1 cellPadding=3D2 width=3D754 border=3D0>
<TBODY>
<TR>
<TD class=3Dtd4w vAlign=3Dtop noWrap width=3D"12%">Jan 22 =
2002<BR>10:53 AM</TD>
<TD class=3Dtd7w vAlign=3Dtop width=3D"10%"><A class=3Dtd7w=20
=
href=3D"http://www.briefing.com/scripts/ArchCal.asp?ID=3DIN"><FONT=20
color=3D#000000>In Play</FONT></A></TD>
<TD width=3D"78%">PeopleSoft (PSFT) 34.37 -0.97 (-2.7%): =
--Update--=20
According to the San Jose Mercury article, PeopleSoft hired that =
subsidiary, Momentum Business Applications, to write new =
software, and=20
Momentum, in turn, hired PeopleSoft programmers at a markup. The =
arrangement transformed the high cost of creating new programs =
into a=20
source of revenue for PeopleSoft.</TD></TR></TBODY></TABLE>
<TABLE cellSpacing=3D1 cellPadding=3D2 width=3D754 border=3D0>
<TBODY>
<TR>
<TD class=3Dtd4g vAlign=3Dtop noWrap width=3D"12%">Jan 22 =
2002<BR>10:49 AM</TD>
<TD class=3Dtd7g vAlign=3Dtop width=3D"10%" rowSpan=3D2><A =
class=3Dtd7g=20
=
href=3D"http://www.briefing.com/scripts/ArchCal.asp?ID=3DIN"><FONT=20
style=3D"BACKGROUND-COLOR: #eaf4f1" color=3D#000000>In =
Play</FONT></A></TD>
<TD class=3Dr2 width=3D"78%" rowSpan=3D2>
<DIV>PeopleSoft (PSFT) 34.32 -1.02 (-2.9%): Accounting concerns =
again=20
putting pressure on PSFT shares. The San Jose Mercury News =
reports that=20
an accounting maneuver by former PSFT head allowed company to =
avoid=20
crushing development costs. Six months before stepping aside, =
PSFT=20
co-founder David A. Duffield transferred $250 million to a newly =
created=20
subsidiary with just one employee and an office down the road =
from=20
PeopleSoft headquarters. Peter Knutson, an associate professor =
emeritus=20
of accounting at the University of Pennsylvania's Wharton =
School,=20
believes the arrangement misled investors: 'It is within the =
boundaries=20
of generally accepted accounting principles, but it is really an =
intent=20
to deceive.'</DIV>
<DIV> </DIV>
=
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