Live Blog: Olympus Admits to Hiding Losses...

Started Nov 8, 2011 | Discussions thread
amalric
Forum ProPosts: 10,806
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Re: what's known vs speculation
In reply to iano, Nov 9, 2011

iano wrote:

Exactly what i was saying. Writedowns are not illegal. Yet they are an admission that previous accounts were incorrect. Writedowns often represent an admission that you have been mislead (or lying) and have been pretending losses didnt exist. Sometimes even decades later!

The difference is you do the writedown and then admit that all along you have been reporting an overvalued asset and pretending losses didnt exist. Instead Olympus of a writedown, did a fraudlent transaction to avoid ever admitting the losses did exist. With a writedown you are admitting they really existed all along and your accounts were hiding the loss. Olympus didn't want to come clean with a writedown, they had this fraudulent transaction to hide the losses instead.

However, when you do it the legal way, you are still admitting that the accounts reported an overvalued, and in some case worthless asset, effectively hiding losses for years and in some cases decades. My point is, that when the accounts have been hiding loses for years through overvalued assets, it is just seen as accounting. Now it could very well be that Olympus did more than report overvalued assets, but again that is all i have seen them accused of doing up until the recent fraudulent cover up.

Yes, indeed. That coincides with what the forensic accountant said days ago. My question is rather: has the value of the company changed, have the stockholders been swindled? And finally, as you hinted at, isn'it infighting between the old and the new management, so that the new one can show better results?

Of course 2 bn $ is a lot of money but that shows too that that level of income can still be generated.

In other words sales might not be affected. By the last report I read i believed that Woodford was hired to restructure hte company. Olympus mentioned that it would be done by not replacing the employees seeking retirement. The marketing network in America was shut down, and some happened too in Europe. OTH Olympus has a flourishing market in Asia. It bought a factory in China and opened Olympus China and Olympus India as subsidiaries. Hardly a floundering company. Did Woodford exceed his mandate in slashing jobs? That would explain the accusation of not respecting cultural differences.

As camera users we would hardly be affected, it the company didn't go bankrupt, and was dismembered. However what I don't accept is the assumption that the financial mismanagement translates in the poor quality of Olympus products, because I know by experience it not being the case.

And I suspect that many clamouring for the gibbet here want just that: the disappeareance of the camera division.

A case of exrtreme schadenfreude if you wish. If you can't outdo them by technological competition, kill them by jumping on their financial mistakes. Which is hardly honest or civil, since this forum is a dual headed entity, and would be impoverished by not being so.

Finally despite its financial difficullties, which other camera makers share too, it has always kept a very high R&D investment, so to lose the camera sector would be an impoverishment of the whole camera making business, in terms of innovation.

Am.

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