Another followup note regarding Gravity. The company holds a 16% in interest in Online Game Revolution Fund. The fund invests in the development of online games.
It appears they are supposed to launch a long awaited game called Grandia Online in August of 2009.
The significance to Gravity is that they use the equity method of accounting for their 16% ownership interest. This has resulted in a fairly significant expense on the income statement.
When a game is under development all of the costs get expensed until it is proven feasible after that point the costs get capitalized. With the launch of Grandia, it is possible they may be able to start recognizing a return from their investment in the fund.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.