“Gene Munster at Piper Jaffray certainly seems to think so and if his expectations hold true, it could be time for celebration for Apple shareholders who have always wondered why the way the company accounts for iPhone sorely under-reports the true impact this device has on the company’s balance sheet,” Goldman reports. “No decision has been reached, Munster is quick to say, but trends and momentum might suggest an accounting change could happen sooner rather than later.”
Goldman reports, “Munster reasons, ‘We believe several industry players (we have not confirmed Apple is one of them) and FASB with the Emerging Issue Task Force, are exploring possible amendments to the accounting rules that require subscription accounting. If the rule goes through, we believe Apple will be able to defer the iPhone revenue in a different (and less dramatic) manner. This could meaningfully alter the reported, GAAP-based revenue numbers in future quarters and the change would likely be positive for the stock.'”
Goldman reports, “This is extremely important… Seeing those ‘true’ numbers might have a significant impact on the way investors view the company and call much greater attention to just how profitable Apple really is.”
Full article here.