Replies to post #5805 on InterDigital Inc (IDCC)

[BondGekko]

spider i think tomorrow is, anyway i bought 20 feb 17.50 contracts as a goof, for 200 dollars, if news hits, those could be worth a fortune, or if trial anticipation gets this up to the 20's, still holding march and june, trying to keep 300 way out of the money contracts open at all times good luck

[Dishfan]

The next significant date for InterDigital is February 3 - when Ericsson will release its fourth quarter financials.

Actually, the report is to be released at approximately 7:30 a.m. Central Eastern Time. For us, that means late Sunday night or very early Monday - depending on your time zone.

The Ericsson press release is post #5404 by nieves.

Anyone interested should check out wireless_wazoo's recent post:

Posted by: wireless_wazoo
In reply to: None Date:1/24/2003 7:50:50 AM
Post #of 5810

ERICY's financials to be released on 2/3 are their interim financials for the quarter as the annual report will not be released until March I believe.

However from PriceWaterhouse's web site, I have listed below some citations which outline an auditor's responsibility for disclosing information about material events before releasing the interim financial statements --

http://www.pwcglobal.com/Extweb/pwcpublications.nsf/docid/CDBDC421C87FA1BD80256AFE0051AA67

34.18 The minimum requirements for footnotes to the interim financial statements are set out in IAS 34.16. The required disclosures are intended to provide the reader with information about significant events and transactions arising since the last annual financial report. Therefore, the disclosures are presented primarily on a year-to-date basis, although the standard also requires the disclosure of events or transactions material to the current interim period. Information material to the current interim period income statement should be provided, since that income statement is required to be presented in addition to a year-to-date income statement.

34.19 IAS 34.16(c) requires the nature and amount of unusual items affecting assets, liabilities, equity, net income or cash flows to be disclosed. Unusual should be interpreted in the light of IAS 8.16, which requires disclosure of items of income and expense within profit or loss from ordinary activities are of such size, nature or incidence that their disclosure is relevant to explain the entity's performance. Impairment charges arising during an interim period may be significant to the interim period, but not to the annual financial statements. Disclosure of the losses would be required in the interim period's financial statements.

The key questions: Is the HRS verdict and it's potential implications for an IDCC verdict of willful infringement covered in the "Provision" already booked in previous annual reports?? ... or if ERICY, booked another $250M in Provisions, would that be material enough to disclose in some explanatory notes per my referenced citation IAS 34.18 above?? ... or does being judged guilty of willful infringement constitute "the standard also requires the disclosure of events or transactions material to the current interim period".

The subject of materiality to an auditor is subjective and much of it is a "gray" area. However I can assure you of one thing --- PWC would feel a whole lot better if a settlement would occur soon so they would not have to make decisions on whether the HRS verdict and potential liabilities to be paid by ERICY are material (over and above the Provisions already booked) to require some sort of "note" disclosure.

Since PWC audited the statements for the rights offering just 5 mos. ago, they want very badly for a settlement to occur for an amount close to what has already been booked. Let's face it, PWC did not book any Provision from 1993 - 3rd qtr. 2000 because ERICY's management was able to convince them that the lawsuit would not result in any loss. However, the Markman hearing in the 4th qtr. of 2000 allowed PWC to see an independent 3rd parties viewpoint of the case and a Provision for "patent disputes" was put on the books for the 4th qtr. of 2000.

Again, if only I could be a fly on the wall and listen to the discussions between PWC accountants, ERICY's attorneys/management and McKool attorneys. One thing is for certain, things are getting more interesting by the day.