Re: [CANSLIM] "M"

From: "Tom Worley" <stkguru@bellsouth.net>
Subject: Re: [CANSLIM] "M"
Date: Mon, 8 Jul 2002 07:23:22 -0400

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One further thought on Merck's treatment of patient co-payments, which
resulted in the Friday filing with the SEC disclosing that nearly 10% of its
reported revenue since 1999 was never collected.

Their auditor, Price Waterhouse Cooper, signed off on this methodology even
though Express Scripts, the third largest pharmacy provider, does not
include patient co-payments. Who is the auditor for Express? Price
Waterhouse Cooper. And the largest provider, Advance PCS, also does not
include patient co-payments, while the fourth largest, Caremark RX, does
include these payments.

One might ask how one of the big 4 auditing firms can find treatment of
patient co-payment to be one way and consistent with GAAP, yet treat it
differently at another firm.

- ----- Original Message -----
From: "Tom Worley" <stkguru@bellsouth.net>
To: "CANSLIM" <canslim@lists.xmission.com>
Sent: Monday, July 08, 2002 7:05 AM
Subject: [CANSLIM] "M"


Well, why should today be any different? Instead of terrorist attack fears,
we have renewed accounting fears, this time with Merck apparently
overstating revenues by a trivial $12 billion with their pharmacy benefits
unit. What's $12 billion among friends anyway? Only enough to turn Asia
around from a nice 1% or better gain across the board into red ink for
almost every exchange. Japan, which had been up nearly 200 points and
breaking 11,000 once again, ended closing down 56 points. And Europe is down
across the board, while USA futures suggest a 1 to 1.5% drop on the open.

In Mexico, former officials of the govt owned PEMEX and some businessmen are
being investigated for paying $134 million for a petrochemical plant that
was never built. Some of those officials were also under investigation
earlier this year for company contributions of $100 million to the campaign
of presidential candidate Francisco Labastida.

Some things just don't seem to be changing, or getting better.

Tom Worley
stkguru@bellsouth.net
AIM: TexWorley



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