EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

07.23.10

Mainstream Press Misreports Microsoft Revenue, Misses Accounting Tricks

Posted in Finance, Fraud, Microsoft, Vista 7 at 11:33 am by Dr. Roy Schestowitz

“One strategy that Microsoft has employed in the past is paying for the silence of people and companies. Charles Pancerzewski, formerly Microsoft’s chief auditor, became aware of Microsoft’s practice of carrying earnings from one accounting period into another, known as “managing earnings”. This practice smoothes reported revenue streams, increases share value, and misleads employees and shareholders. In addition to being unethical, it’s also illegal under U.S. Securities Law and violates Generally Accepted Accounting Practices (Fink).

2002 story about Charles Pancerzewski, Microsoft

Summary: Microsoft carries on with its deferral tactics and it also takes more debt, which embellishes its financial position amid very difficult times

MICROSOFT has a criminal baggage, as everyone ought to know by now. There have been funny things around the accountancy inside this company (which has a history of financial fraud). Due to lack of time, we are not going to repeat what we already covered along with supportive evidence. Currently, Microsoft finds itself reluctantly announcing further layoffs whose purpose is to cut expenses [1, 2]. Microsoft has had too many flukes recently. It has also taken more debt, as we noted repeatedly this year and last year.

On the face of it, what Microsoft does at the moment is it sells a bunch of block-future-licenses to the OEMs, does not yet get the money, and puts that on the plus side of the balance sheet. Apple, by contrast, doesn’t have OEMs, so it needn’t play that particular accountants’ shuffle.

“That means revenue isn’t really $16bn but $10bn and combined with fake OEM-futures isn’t an accurate picture.”
      –Anonymous source
Some Web sites blindly repeat Microsoft’s press release/report. It’s so much easier (and faster) to not ever investigate or be sceptical. It’s also a lot safer, as standing out from the crowd is clearly riskier to a journalist. One site, however, previously pointed out (2 months ago) that “The company’s $2.25 billion in short-term debt and $3.75 billion in long-term debt, combined, is less than its $8 billion cash hoard.”

As one reader of ours put it, “That means revenue isn’t really $16bn but $10bn and combined with fake OEM-futures isn’t an accurate picture.” Vista 7 is not selling well and as we wrote 3 months ago, Microsoft used the deferral trick to elevate Office revenue since the previous quarter (same accounting trick it used for Vista 7 two quarters ago).

We will share more detailed explanations later (there is a lot of catching up to do with Microsoft news, at least 3 weeks’ worth due to that vacation in London, which I now have photos from).

This post is just a placeholder that hopefully addresses questions we heard from people who believe press releases (and those who merely parrot them). A more detailed analysis will come soon.

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

What Else is New


  1. Anonymous Professionals Speak of Benoît Battistelli's Destruction of the EPO, But Why Does the Media Turn a Blind Eye?

    Everyone in the circles of EPO staff and EPO stakeholders knows that dysfunction has become the norm; European media, however, remains suspiciously silent about what otherwise would be a major European scandal (bigger than FIFA or Dieselgate)



  2. The Darker Past of the Next President of the EPO - Part III: More Details About Caixa Geral de Depósitos, Former Employer of Campinos

    The side of Campinos which he prefers to conceal, or rather his association with a rather notorious Portuguese bank



  3. UPC Looks Like More of a Distant Dream (or Nightmare) as Germany Adds Another Two Months' Delay

    The likelihood that the UPC will be altogether scuttled is growing as delays keep piling up and more complaints are being filed by public interest groups (as opposed to Team UPC, which hoped to shove the UPCA down everyone's throats behind closed doors)



  4. Patent Trolls Roundup: BlackBerry, Dominion Harbor, IPNav, IP Bridge

    A quick review of recent news regarding patent trolls or entities which resemble (and sometimes feed) these



  5. Battistelli's Destruction of the EPO is Bad for Everyone, Even Patent Attorneys

    The collapse of the European patent system, owing primarily to Battistelli's totalitarian style and deemphasis on patent quality, means that "the war is lost," as one professional puts it



  6. Links 19/10/2017: Mesa 17.2.3, New Ubuntu Release, Samsung Flirts With GNU/Linux Desktops

    Links for the day



  7. Some of the USPTO's Most Ridiculous Patents Are Scrutinised by “Above the Law” While Dennis Crouch Attempts to Tarnish Alice

    Controversies over patent scope and level of novelty required for a patent; as usual, public interest groups try to restrict patent scope, whereas those who make money out of abundance of patents attempt to remove every barrier



  8. Microsoft's Software Patents Aggression in Court (Corel Again)

    Microsoft's tendency to not only abuse the competition but also to destroy it with patent lawsuits as seen in Corel's case



  9. The Spanish Supreme Court Rejects the EPO's “Problem and Solution Approach” While Quality of European Patents Nosedives

    European Patents (EPs) aren't what they used to be and their credibility is being further eroded and even detected as such



  10. Europe is Being Robbed by Team Battistelli and the UPC/PPH Would Make Things Worse

    The European Patent Office (EPO) has put litigation at the forefront, having implicitly decided to no longer bother with proper patent examination and instead issue lots of patents for judges and lawyers to argue about (at great expense to the public)



  11. Team UPC Continues to Promote Illusion of UPC Progress Where There's None

    The core members of Team UPC in the UK spread obvious falsehoods in the media, probably in an effort to attract 'business' (consultation regarding something that does not exist)



  12. António Campinos: A True EPO Reformer or More of the Same?

    More unfortunate reminders that Campinos and Battistelli don't quite diverge on the big issues, they're just more than two decades apart in age (but the same nationality)



  13. Juve Has Confirmed That António Campinos is French

    The relationship between Campinos and Battistelli has a nationality aspect to it, not even taking into account the interpersonal connection which goes a long way back



  14. The Darker Past of the Next President of the EPO - Part II: António Campinos at Banco Caixa Geral de Depósitos

    A look at the largely-hidden banking career of the next President of the EPO and the career of the person who competed with him for this position



  15. SUEPO to the Media, Regarding Campinos: “No Comment, It’s Too Dangerous”

    António Campinos, who is Benoît Battistelli's chosen successor at the EPO, as covered by German media earlier this month



  16. Staff Union of the EPO (SUEPO) Willing to Work With Campinos But Foresees Difficulties

    New message from SUEPO regarding Battistelli's successor of choice (Campinos)



  17. Links 18/10/2017: GTK+ 3.92, Microsoft Bug Doors Leaked

    Links for the day



  18. The Darker Past of the Next President of the EPO - Part I: Introduction

    Some new details about Mr. Campinos, who is Battistelli’s successor at the EPO



  19. Confessions of EPO Insiders Reveal That European Patents (EPs) Have Lost Their Legitimacy/Value Due to Battistelli's Policies

    A much-discussed topic at the EPO is now the ever-declining quality of granted patents, which make or break patent offices because quality justifies high costs (searches, applications, renewals and so on)



  20. Patent Firms From the United States Try Hard to Push the Unitary Patent (UPC), Which Would Foment Litigation Wars in Europe

    The UPC push seems to be coming from firms which not only fail to represent public interests but are not even European



  21. In the Age of Alice and PTAB There is No Reason to Pursue Software Patents in the United States (Not Anymore)

    The appeal board in the US (PTAB) combined with a key decision of the Supreme Court may mean that even at a very low cost software patents can be invalidated upon demand (petition) and, failing that, the courts will invalidate these



  22. IAM is Wrong, the Narrative Isn't Changing, Except in the Battistelli-Funded (at EPO's Expense) Financial Times

    The desperate attempts to change the narrative in the press culminate in nothing more than yet another misleading article from Rana Foroohar and some rants from Watchtroll



  23. The Federal Circuit Continues Squashing Software Patents

    Under the leadership of Sharon Prost the Court of Appeals for the Federal Circuit (CAFC) continues its war on software patents, making it very hard to remember the last time it tolerated any



  24. SUEPO Representatives Like Elizabeth Hardon Vindicated as Battistelli's Detrimental Effect on Patent Quality is Widely Confirmed

    Feedback regarding the awful refusal to acknowledge patent quality crisis at the EPO as well as the appointment of a President so close to Battistelli (who most likely assures continuation of his policies)



  25. Links 17/10/2017: KDE Frameworks 5.39.0, Safe Browsing in Epiphany

    Links for the day



  26. Judge Bryson Rules Against Allergan After It Used Native American Tribes to Dodge Scrutiny of Patents (IPRs); Senator Hatch Does Not Understand IPRs

    Having attempted to dodge inter partes reviews (IPRs) by latching onto sovereign immunity, Allergan loses a key case and Senator Hatch is meanwhile attempting to water down IPRs albeit at the same time bemoaning patent trolls (which IPRs help neutralise)



  27. Rumours That António Campinos Initially Had No Competition at All (for Battistelli's Succession) Are Confirmed

    Succession at the EPO (mostly French) shows that there's little room for optimism and Battistelli's people are too deeply entrenched in the upper echelons of the EPO



  28. EPO Stakeholders Complain That the New Chairman Does Not Grasp the Issues at the EPO (or Denies These)

    Some information from inside the EPO’s Administrative Council, whose Chairman is denying (at least to himself) some of the core issues that render the EPO less competitive in the international market



  29. Another Misleading Article Regarding Patents From Rana Foroohar at the Financial Times

    In an effort to promote the agenda of patent maximalists, many of whom are connected to the Financial Times, another deceiving report comes out



  30. Monika Ermert's Reports About the Crisis at the EPO and IP Kat's Uncharacteristically Shallow Coverage

    News from inside the Council shows conflict regarding the quality of European Patents (granted by the EPO under pressure from top-level management)


CoPilotCo

RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

CoPilotCo

Recent Posts