After a review of its accounting practices, Gemstar-TV Guide International
Inc. is taking the eraser to its past financial statements, eliminating $19
million in previously reported licensing revenues and $8.2 million in
interactive-programming-guide ad revenues.
A lion's share of the canceled licensing revenues came from $18.1 million
from an agreement with AOL Time Warner Inc.
In addition, the Pasadena, Calif.-based provider of IPG software and
home-entertainment systems will reclassify $26.8 million in licensing revenues
as either a reduction of operating expenses or as other income, and another $47
million in reported revenues will instead be recognized over the remaining terms
of the company's licensing agreement. Both changes stemmed from a settlement
agreement with "a certain set-top manufacturer," according to a company
The changes affected statements for fiscal quarters that ended March 31,
2000; Dec. 31, 2000; Dec. 31, 2001; March 31, 2002; June 30, 2002; and Sept. 30,
The restatements will not impact Gemstar's cash position for any of those
fiscal periods, according to the company.
Back in November, Gemstar announced that it had hired a new independent
accounting firm to oversee its financial statements and review other financial
There may also be additional restatements as that process continues, which
"may be material," according to a company statement.