WorldCom Takes Another $3.3 BILLION Write-Off !

FOX News Channel | August 8, 2002 | FOX News Channel Staff

[TheCPA]

WorldCom's stock is not totally worthless. It is still publicly traded. The symbol is WCOEQ.PK. I own shares in WorldCom that I bought at seven cents a share, and I am holding them at a profit. I sold enough shares at a profit to recoup my cash investment and earn a small profit and held onto my remaining shares. If WorldCom is entitled to a tax refund for newly discovered expenses, it should receive every penny of it.

[lavaroise]

Worldcom cannot have it both ways, either it reports expenses and losses, or it does not.

[lavaroise]

Heck, it would be so easy for them to hide earnings. If they can hide losses, they can hide earning in nice off shore accounts and then claim tax deductions?? After getting bailed out through bankruptcy?? I don't think so indeed.

[steveegg]

Months? Try years. The Cooked Book Disease really got going in 1998, just in time to save S(l)ick Willie.

[MeekOneGOP]

Won't do anything tomorrow but will further tarnish confidence in US corporations to do honest accounting. Our USG doesn't do honest accounting either while we run around the world preaching the virtues of transparancy.

That will need to be addressed in the near future, too!
Can I buy you a cup of coffee, FRiend?

Have a cup while you FReep !

[rebapiper]

The Clinton's spent their time in the White House selling
out this country. Large Corporations were cooking the books
while millions of dollars were flowing into the Clinton foreign bank accounts and the Demorat party. Clinton and
Rubin were trying to bankrupt this country. Greenspan and
his so call bubble was nothing more than a cover up for what
the Clinton's were doing. When will someone go this Bob Robins books. Everytime Clinton and Rubin came back from
India they made it a point to go directly to Greenspan's house. I'm sure Greenspan is right in the middle of the Enron mess.
Trent Lott had Rubin and Clinton by the short hairs and
they let them go, secret deals that the IMF, Rubin and
Clinton were making and Lott put on his knee pads. Trent Lott could have exposed many of these corporations and Rubin
while Clinton was in office.
Don't be shocked if someone happens to find that Rubin may
have been cooking the books as well, I'm waiting to see how
long it will takes.
Now we know why the Clinton's were fund raising non stop,
now we know were these corporations were getting the money
to pad the the Clintton foreign bank accounts.
Brazil gets another $30 billion to bail out the market, what happen to the money that Rubin and Clinton got for Brazil. Brazil gets double what the ask for, wonder why?
Could it be the Demorats are getting KICK BACKS from these
countries?
Bush said he would veto any bill the would be more than what was asked for. Bush Jr. read my lips.

[dennisw]

WorldCom's stock is not totally worthless. It is still publicly traded. The symbol is WCOEQ.PK. I own shares in WorldCom that I bought at seven cents a share, and I am holding them at a profit. I sold enough shares at a profit to recoup my cash investment and earn a small profit and held onto my remaining shares. If WorldCom is entitled to a tax refund for newly discovered expenses, it should receive every penny of it.
_________________________________


The current "street" advice is to hold onto those 6¢ WorldCom shares and consider them junk stock that can only appreciate. Anyway who is going to get rid of this rotten stock to realize a lousy $50 on their 1000 shares?

[dennisw]

Hey good morning you un-grouchy freeper. Pl make mine strong tea! Here's my book tip to you:

http://www.amazon.com/exec/obidos/ASIN/0767903595/104-0008749-4554356

[MeekOneGOP]

A spokeswoman for Clinton, Mississippi-based WorldCom...

Oh the irony!

LOL !

[rebapiper]

I guess they forgot to count the money given to the Clinton
and the DemoRats at the fund raising events.
They cooked the books while the Clinton raked in the cash.
A good economy as long as the DemoRats stay in office to cover up their corruption.
Rubin and Clinton were bleeding these corporations and Clinton and Rubin wanted to get their hand on the SS money.
If the Republicans would have given in and turned over the
SS money to Rubin and Clinton the SS program would be in the
same boat as Enron and Worldcom.

[mewzilla]

It really wasn't a co-inkydink that Arthur Levitt's proposed auditor independence rule got #!$&-canned in 1999. I'll bet the people who made sure that never happened had a pretty good idea of what was being done with some of these corporate books. Arthur Levitt really should be asked about that.

[MeekOneGOP]

As we approach the day of truth in corporate balance sheets, I would like to make two predictions. I believe that day is 12 August when CEO's have to sign their companies balance sheets as being accurate. If they lie they get to clean Martha Stewarts cooking pots and pans in jail.

< snip >

These corporations will have or had Rat CEO's and boards. They donated massive amounts of money to the Rats and the Clintoonians. They hired lawyers instead of scientists and good accountants. They never had good products or good people to make and sell the products. Last but not least, most of them used the Arthur Anderson, Clintoonian/Dood creative accounting to appear to magically beat their goals every day, week, month, quarter, and year. These Rat CEO's have the same problem defining a real profit as their buddy boy Clinton did in defining "Is and Sex".

Outstanding post, Grampa !

"Think of the great following Martha has throughout the country - There's no telling how she's broadened my base today," President Bill Clinton said at the luncheon.

[Wyatt's Torch]

Because the bad debts expense entry is an estimate for financial accounting, a company should be able to reverse part of the entry later if the estimate in a prior period was too high. The effect of such a reversal is to increase income in the current period. Such an entry has no effect on cash flow.

As you could probably tell, I'm not a CPA. I have, however, had P&L responsibility. Thanks for refreshing my memory on the difference between a "liability" and a "contra-asset". I think the broader point remains, however, that adjustments of reserves to affect earnings is done everywhere. Be thay vacation, bonus, or acquisition reserves/accruals, it is done by every company. The other point you address is that these adjustments in reserves have no cash flow impact and that is key. Too many analysts focus on P&L results when they are easy to manipulate (also called Accounting our way to glory!). Cash flow is a different ballgame. Just as when WCOM was capitalizing expenses, that would have been caught on the Cash Flow statement as in increase in capitalized expenses and offset the increased earnings.

Regards

[MeekOneGOP]

You have probably seen this before, but just in case you haven't!

Clinton Crying - Video @ Ron Brown Funeral
Laffing & So Forth Til He Sees Camera.....

[MeekOneGOP]

[Wyatt's Torch]

My theory for the massive writeoff of goodwill etc is what is known as the "blood bath theory." It means that when things are bad, recognize all bad things at once so that once things turn around, the future will look better than it otherwise would.

Bingo. They are getting rid of all the skeletons and all the risk on their balance sheet.

[MeekOneGOP]

[MeekOneGOP]

[MeekOneGOP]

[MeekOneGOP]

If I'm reading this right and it was simple reversals of bad debt accruals then every company on the face of the planet is guilty.

This is an expense that was taken in a prior period and put into a reserve on the balance sheet. When bad debts (customers who fail to pay) occur, you write it off against the reserve. Periodically, these reserves are reviewed to see if they are too high or too low. If too high, you write down the reserve and take it into operating income. This has no impact on cash flow because the decrease in the liability offsets the increase in operating income.

This is one of the most common accounting practices and every company on earth does this. Unless there is more to the story, this is a non-event.

If this is as you say, then this is very bad reporting by the media. However..........

I don't believe that this story is about GAAP accounting. This is a story about fraud, lying and deception. In other words, they were hiding stuff, which is not a part of Generally Accepted Accounting Principles. President Bush is correct in saying these folks that deceive stockholders, employees, etc. should be hauled off in handcuffs and prosecuted. And so they shall......