Microsoft Accounting Changes – Image direct linked from ZDNET

And now Microsoft is playing games with it’s accounting. The right hand column is as reported, the left hand column is how it would look as reported under next years method. What they’ve done is moved certain products to other business units. Note that Client revenue has climbed almost $600,000,000 dollars. Nice. Than note that Client Operating Income has dropped by about $700,000,000 dollars.

What they did was move a money loosing operation under Client, when usually makes a large profit, so that they can hide it better. Obviously its something that the company thinks is important, that they don’t want to loose. In this case they don’t want to loose Search, so they’ve moved Windows Live (which includes Search, Online Email, etc) into Client from Online Systems Division.

Now this only works as long as Client reports a strong profit. This means that Microsoft has to successfully destroy the Netbook Menace. Can they do it?


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