TSX:LSG.DB - Post by User
Post by
yoda2on Feb 25, 2013 1:18pm
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Post# 21038980
WARNING about carrying value
WARNING about carrying value This could be very scary. Write-offs to reduce carrying values would likely represent the first formal recognition of the cost of past mistakes in acquiring assets by: buying, building, merging,etc.. Shareholders might be shocked by the magnitude of these charges.
It is unfortunate that the only way LSG shareholders would become aware of these previously hidden impairments and/or mistakes. While being billed a mere accounting 'mumbo-jumbo", these upcoming reductions in asset carrying values could be very important in assessing past performance and in determining the perceived market value of LSG shares. These write-offs will represent real lossess of shareholder value caused by past management decisions and actions.
We have to wait to see the details of them but the news release is a warning and would seem to indicate that big write- offs are to be announced. As they are not likely to be pleasant, they should be considered scary and worrying by LSG shareholders.