Activision-Blizzard September results reveals box sales paradigm

Reader Comments (Page 1 of 1)

11-06-2008 @ 3:18PM

Verata said...

As an Accountant, I will tell you this is apart of US Generally Accepted Accounting Principles (GAAP) - not just a greedy malevolent corporation trying to bleed customers dry. Software sales, especially, with any degree of possible return of product, have to have the revenue deferred over the "average life" of the product (and, yes, management then has to justify how they calculate the average life to their auditors).

The risk isn't, initially, to keep shareholders happy but to properly align revenue with the risks associated with the return of the product. This also keeps ANY company from issuing a complete P.O.S. product which has huge initial sales and then has all those bogus items returned.

Just an FYI for one of those people who would understand all that boring stuff in the Financial Statements.

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