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CageStudy-6: Tesla's Non-Gene Accourninq Meosurement

Revenue Recogrnition.ond. Stock. bosed Compensotion.

reasonoable. to state thot Teala had been Profitoble


4los t
inthe thid quOYtex of 201t
Pns Dnderson who uwas an onalyst ot boutique invextment
pexfornman.ce reported
fmShe noticed that the fnancial
0on-6AAP measurementi
undey Us 6AAP& the Texlas Own
s t a t e that Tesla
uwos
it reaonable t o
I dont believe it
quavtex 2014. Texla Yecorded
Profitable in the 2 of
6AAP A Straight
Kevenue for the model ttechicles undex non-
wexetreated
as
undey 6AAP the model-S
Kevenue,wherea
leaxes uith most ofthe reVenue being uneaxned defexxed
YevenueThe model- S Vechile Sales Should
not be immediately
Dransfy ixevexsi
fully vecognized ox the ownevship oeanot.
delivenTt shoudd
tothe Cutomer until 3639 moths aftr
be treated o a lease and not fully xecognised

2. lexe teslo Doo-6AAP adiustmentsapp.xepxiatce2


Ans doo't thiok non- 6AAP adjustoeots axevnappropYiate
0 fheypotxouy mSleadingpictueof fheix earaings
Tesla uwans people tobehveundex theix no0- hAAP

adsustroen fhat evey Co saleiS fullyecognised where


ineaGty heCa Sales ageoDe Gke leases tuithin
olesen ed eye0ue twe don'tKnew uhat pxeveot of he
cans axe boughthevek by Teala Tealah non-6haAP adyust
ment o foStock bosed CompensatiooiSahounoppopnaie
3HHOwCouldthe Ddjustment.s betweeo Teslas GAAP ao

non 6AAe umbexsbe esplaied 2


Andexsenshe ocalysed
Ary The analyst christine
millioncilfesence
Ghnp and
between Teslos
the 80
ondques hioneol howSuch alange
noo-bfAP_ eonings
be cxeated by dillefent measr
y
disCxepao Could
ment ules
for
Teslo twouldcpost sales
Undex GAAP
04 0.Leose
which tberc wo a buy back qubaontee
only p o t of 3evenue each yea ord
recogniging io fhe balonce
fheembinde being dedemd o habiliky

Sheet JEle calulatiog ib Don-hAfp uncaine fhe


companLyepoitcd the omount of dekerred
xeveoue
undex n o o - 6-tMP=
o.nd Cocponduiog net uneioe epoyteel
to be biohex fha0 he omount epo1fed vodes 6dfAP
Stock based compenbaboo wos psovided to
employeesto Dopthvotehem f p engoge ioacbuibes

oak roaimi3ed he fixms inancial pexfoimand


1ssuone of Stock0phionis NpxcAcoted alacost
to ib compony and iH share bolders Tesla adiusted
i 6h stakenenH by adding back a0am2unt of
f39.2 million ioStock 6baned compendabo0 forbe
quontex endingseptembes 30, 2014 to calculate on
GnAAP net uocame he Company alloted a lasoe
posk Df ib stock -based compenAaztioo toSelling, 4tnta
and aderinistxotive qe0tial cxperses (19:1oillion) than.
to yeaeanch an.d devtlopment[ 16:6.milli.on)with the
Yerh aindtx olocaled tocost of ales 5-pmllion)
h aWhat
t Lwoulo Testa pexfoimances took ike if she odjusted
t e fioancial statement fo he esale volure quareotee
segulatony CxedLH a0d stoct- bosed compematoo?
Teslo iancial statcroent shouweod a lem of
oloDs 5 miltioo using .S: GAAP slandamasComposed
t oa prbit D
pXbfit ove 5 millioo in noO-bAnP Staodords

Refexioq to Testo intome statement fox the


u a t e A endecl septcmbey 30,2014 t comes ho notbce
that fbe ofbex ocome and Jotesextepermeseftects
fbis Odiustmeot as the d£fereoce in mounts bettwee
6AfP Qnd DoO- 6AfP

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