Slightly different take on todays proceedings from what I...

Slightly different take on todays proceedings from what I saw

Sisson was being questioned by the ISX counsel on his two reports - trying to draw out a change in opinion.. Sisson did pretty well clarifying that they weren’t different opinions, just the second was a more considered view (and wasn’t inconsistent with the first).
it was all centred on at what point the distinction between recurring v one off revenue became a material piece of information (whether it was in June when ISX flagged unaudited revenue had been earned and the milestones were going to be met, or the end of July when the quarterly was released, or in early August on the analyst briefing when the infamous response was given).

Sisson naturally was drawn in his responses to his second report, and the ISX counsel quite rightly stepped through it methodically, but I don’t think he got the admission he was ultimately looking for.

Houston came across knowledgeably but pretty defensive.. a number of times his response to a question/assertion was no.. but then once stepped through the matter had to accept / agree..
his overall opinion was the distinction that recurring v non-recurring was not material.. based on the fact it was historical revenue only and companies are valued on future discount cash flows.. ASIC counsel’s line was questioning was to show that recurring revenue directly (borrowing Houston’s terminology) evidences immediate future revenue (I guess revenue that can be “locked in” and more easily quantified / modelled) - which is why the amount was annualised by the broker and as part of the support for the target price.. it was a bit awkward / funny seeing Houston try and downplay the amount being annualised.. that’s only ever done for one reason, where it’s being suggested the amount will continue going forward..
the questioning by the ASIC counsel ended pretty abruptly, again on a point where Houston answered no in a direct response, but in further explanation said statements which actually agreed.. I think the ASIC counsel got what he wanted and stopped

there was also a bit of discussion in Sisson’s questioning and response at the end by Houston re how effective the market of ISX shares was at the time (ie how quickly price sensitive info could be absorbed and then ultimately reflected in the share price). Sisson’s view was that it wasn’t sufficiently liquid / traded and therefore movements could take time to manifest. Both presented their arguments well, but at the end of the day one was subjective and the other objective.. when the reality probably sits in the middle.. the analytical approach adopted by Houston probably has a few more potential holes in it, will be interesting to see what the Judge makes it all that