| KROCALOPOLIS said: Actually it's not an Advance and Michael Pachter needs to pull his head out of his ass. If it was an advance or basically a loan contingent upon completing a function, Take 2 wouldn't be able to book the revenue as deferred. They cant book it as revenue yet because according to GAAP and FASB the goods must be available for sale. So at the end of FEB they will book 25 mil as rev when the title is released. If it was an advance or a loan then Take two would have to book it as a LIABILITY.....these are basic accounting functions and auditors wouldn't let something that big or obvious happen. Its misinformation to say that Take Two owes anybody anything at this point. Look Below and look up how to treat advances and what deferred revenue is. All throughout 2008 Take Two had zero short term debt and only 44mil in long term debt......Why wouldn't the company take a 50mil line of credit out with somebody or private placement and make it a multiplatform title then? If you say Take Two has to pay anybody back then whats the incentive to take that action? Zero interest for a year? Don't think so, thats just retarded..... http://finance.yahoo.com/q/bs?s=TTWO
"Take-Two has already recorded the payments in financial filings as deferred revenue, explained Lainie Goldstein, Take-Two's newly appointed CFO, in a conference call with analysts. " http://texyt.com/Microsoft+pays+$50m+for+GTA+4+episodes+00111 |
http://www.moneyinstructor.com/doc/deferredrevenue.asp
"Deferred revenue refers to an item that will initially be recorded as a liability, but is expected to become an asset over time and/or through the normal operations of the business. Deferred revenue is sometimes called unearned revenue, and it is through the use of this term that I believe it makes it easier to understand why it is initially a liability but is later transferred to an asset item."
This goes completely with what Pachter said. They will have to 'earn it'.
