160 ShowMetheMoney
recording the amount of
cash we “burn” as an assetCompanies with negative cash flows sometimes get credit for the
amount of cash they raise an dspen don researching new pro ducts.
This is especially true in the biotechnology industry, but we see no
reason why the logic of that approach shoul dnot exten dto our busi-
nesses as well. Speculators an dtra ders give substantial valuation
credit for this cash burn.
Beginning today, we will treat the amount of our cash burn as an
asset on the balance sheet rather than as an expense on the income
statement. On the other hand, because of the significant impact that
the treatment of disbursed cash as an expense or an asset has on our
earnings, we reserve the right from time to time to alternate between
these treatments, depending on the trend in reported earnings from
quarter to quarter.
reporting in a different
currencyWe sell many of our products and conduct a clearinghouse operation
for other businesses in a barter exchange Web site on the Internet.
In lieu of trading (or bartering) such goods and services directly, how-
ever, exchange members use our trademarked “dot-com dollars,” is-
sued to them by us for the purpose of bartering. These dot-com dollars
have a face value far greater than the U.S. dollar and we propose to
record certain of our assets and sales transactions in dot-com dollars
rather than U.S. dollars, thereby substantially increasing the amounts
of reporte dassets an dincome (we are not fools, however, so expenses
an dliabilities, of course, will continue to be reporte din U.S. dollars).
refining the concept of
materialityLawyers an dau ditors often place great weight on whether some eco-
nomic event is material to our company or not. They define materiality
in terms of what a reasonable investor thinks about its impact on the
business or financial condition of the company. In the past, this led
us to report in our financial statements details that don’t really seem