|
|
Enron Mail |
No, I don't think I'd make a better accountant. But I did ask a few
questions of my accountant brother-in-law. You did a great job. I don't know how much time I'll have, but I'll see if I can throw in a bit of text and raise the issues. See you tonite. Kimberly Kupiecki <kkupiecki@arpartners.com< on 09/18/2000 09:53:30 AM To: jdasovic@enron.com cc: dwindham@uclink4.berkeley.edu, jjackson@haas.berkeley.edu, jcjcal02@aol.com Subject: Re: Q2 for Patten Case Hi Jeff, I guess you would make a better accountant than me. Your analysis sounds right. Feel free to make changes as fit. My apologies for missing out on these items. At 06:18 PM 9/17/00, jdasovic@enron.com wrote: <Hey, nice spreadsheet. Two minor questions: < <1) Isn't the provision for taxes on the income statement actually the taxes <on the 'income' they made from using the sales method (equal to 46%), <rather than what they pay will actually pay the IRS under the installment <method? I think the notes show how instead of paying the 4.1$ based on <their recognized income, they pay some itty bitty amount based on <installment. If so, I think they actually get a 46% tax break on the 1 <million and change that they lose using a cash basis. Still a loss, just <not so big. Anyway, I'm not sure if I'm thinking straight on this, but <that's how I read the numbers. < <2) Does the balance sheet have to change a little? For example, does <shareholder equity change since the income that goes to retained earnings <is now a loss, rather than a gain? Also, if revenue is recognized on a <cash basis and is now much smaller, there needs to be another liability to <equal out the decrease in revenues with the still large notes receivables <on the asset side (as you note in the answer the notes recievables stays <the same). Seems like they might need a liability like "deferred profits" <or some such thing, such that the ["deferred profits" + revenues <(recognized on cash basis)] = notes receivables. < <Anyway, I may not have this right, but thought I'd bring it up to see what <you think. < <Best, <Jeff Kimberly Kupiecki Senior Account Executive A&R Partners kkupiecki@arpartners.com (650) 762 2800 main (650) 762 2825 direct fax (650) 762 2801
|