Plug Power Inc (PLUG)

[uksausage]

there were two things in the Q3 numbers that have to be addressed to get the accounting straight. yes you are right about some other things like the litigation costs appearing.

1. revenue recognition. we have heard two things about what it was both of which are against GAAP rules. Either Andy didn't know what he was saying or they are in a real mess.
At the Q3 call they said a $5m check arrived 3 days into the new quarter or their earnings would be higher. That is wrong it affects cash flow not earnings, revenue recognition is on invoice or other milestone defined in the contracts.
At the business update Andy said revenue recognition was on order - which is way worse and I cannot believe from current filings.
It is symptomatic of the accounting controls that were in place that Paul M has had to get a grip on and would have caused the delay in filing due to explaining to the auditors

2. While the made lower margin on hardware sales due to the product mix that they explained, they made a loss on service sales which in Q2 had been profitable. This was explained as some manufacturing/hardware issues causing replacement parts to be needed and some other post acceptance services that they said had been addressed.

I don't recall any forecasts being made in the Q3 call as they had no CFO. but Paul has every incentive to make Q4 as bad as possible so Q1 looks awesome.