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11-06-2008 @ 3:15PM
Michael, you missed the big reason that this is the accounting policy. It is a little thing called revenue recognition and it is based on GAAP (generally accepted accounting principles). Activision-Blizzard realizes if revenue is recognized at time of sale, it is not an accurate presentation of when the actual earning of the revenue occurs. I really don't think that statement has anything to do with whether or not they want you to have fun.Also remember, cash is king. Although the statement of operations is important, a huge performance indicator is cash flows from operations.
11-06-2008 @ 3:26PM
Additionally in the GAAP rules they can't recognize the retail sales of WotLK in September because they haven't actually given you your box yet. Essentially thier commitment to you hasn't been fulfilled until after you have the box, can no longer return it to the store, and you cancel your subscription. Under GAAP they can't recognize all the revenue from the sale of the box until after all of their possible commitments associated with the sale are completed. This includes customer service regarding the sale. There are standard forumlas that accountants use to recognize revenue over time for such a sale and this is another reason why the revenue is spread over a period and is reported in this way. Standardized business practices FTW.
11-06-2008 @ 3:33PM
^ This is the truth.The do it that way because the HAVE to... not because they want to.
11-06-2008 @ 5:11PM
Yeah I am with you. This is just an accepted accounting move. I doubt that top management wants to show how much fun they want us to have through their accounting principles. I wonder how long they defer a portion of the boxed sales? I doubt its longer than a year or two.
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