Biovail Case Essay

In the side when ownership changes hands upon receipt of the product at the distri exceptors facility (FOB destination), the second condition for revenue enhancement enhancement recognition under SAB101 has non been met. In this case the comp some(prenominal) would not avow revenue because deliverance did not occur. Part 3 The shipment left Biovail on kinsfolk 30, 2003, which is in the 3rd quarter. Under FOB shipping point guidelines it would be correct to recognize revenue for the shipment in the Q3 report. Assuming revenue associated with this shipment was included in Q3 earnings as originally stated, no further impact.Under the FOB destination guidelines it would be incorrect to recognize revenue. In that scenario the truck does not reach its destination in the 3rd quarter and thus no shipment is made and revenue should not be recorded. Assuming that this shipment would take longer than 1 day to reach the distributor, based on the fact that it is in gelt on 10/1, this ship ment shouldnt admit been planned as revenue in quarter three anyway. The accident will have an impact on Q4 revenue. Part 4 Biovails treatment of analysts who mask their stock is concerning.It is still unclear whether Treppel was correct or too harsh, but Biovails fierce retaliation against Treppel highlights their willingness to go to great lengths to suppress any negative analyst reports. This combined with, the lack of clarity around their chronicle practices and conflicting arguments from their distributor lends us to question their integrity. This would create a problematical environment for an analyst to create a unbiased report and significantly discourages us to be an analyst covering this company.