Why Are They Hiding R&D Off The Books?I noticed that in 2008 Photon set up an outside R&D company. A friend of mine refuses to invest in the company because he is sure this is a sign of something not being right. I am thinking there is an explanation for it, but management does not explain this in the footnotes. Does anyone have an answer from Photon on why this structure exists?
I looked at financials on Reuters, and what is disturbing there is that:
* On cash flow, capex is almost nothing, investments are almost nothing
* On income statement, R&D has almost nothing assigned to it. This could be about how Reuters is reporting data though.
Is Photon disclosing an R&D investment level appropriate to its size? How much of the R&D activity is taking place outside the company, on the books of a another entity?