Slaters Must Wait On Quindell 

Assignment Task

Introduction

Quindell said that the restated accounts adopt a more conservative and appropriate approach to the recognition of revenues and profits in the PSD. Slater & Gordon expected those accounts to "present Quindell's view of the PSD's assets on disposal", with lingering questions about whether the Sydney-based law firm paid too much or too little for the assets. At the time of the acquisition, some investors had queried whether the price paid for the PSD, which made up the bulk of Quindell, was too low, considering the company was valued at four times that amount a year earlier. Slater & Gordon shares firmed yesterday, up 8c to. But its market capitalisation has fallen almost  since last Wednesday morning, when reports first emerged that the Australian Securities and Investments Commission was querying its relationship with auditor Pitcher Partners. Yesterday, The Australian revealed that Pitcher Partners had been dumped, with the law firm appointing Ernst & Young to take over after ASIC'

Questions

1. Explain the statement that confirmed revenue recognition were at the aggressive end of acceptable practice?

2. How was the company revenue generation prior to this event?

3. How this event will change the Consolidated Statement of Profit or Loss and Other Comprehensive Income?

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