The primary reason for the difference, particularly in the...

The primary reason for the difference, particularly in the December quarter because rebates were processed annually, is the treatment of rebates. These are accounted as revenue, but not actually realised as a cash receipt until received. They've changed this to apportioning the rebate over a quarterly basis now so there won't be a hugh revenue/cash receipts discrepancy in Dec qtr anymore, instead will be apportioned over each quarter.

So looking at the recent March Quarterly, the revenue was $2.2m and cash receipts were $1.75m. A difference of $450k...some of this variance will be due to the new apportioning of tax rebate 'revenue' quarterly rather than annually.

There is also some impact from the way actually 'business' revenue is accounted for, this is explained in the Dec quarterly as follows:


So basically as I understand it this means if a contract with a school is say organised for three years, then payments over that three years are treated as cash receipts when received, but the value of the contract is amortised during the three years equally.

So if $20k over two years, but $10k upfront while the remaining $10k equally received over the two years on quarterly basis, then there would be a diff in revenue vs cash receipts. The cash receipts would be $11,250 for first quarter (ie $10k plus $10/8) then $1.25k for each remaining quarter. The revenue on the other hand would be apportioned over each quarter for two years, ignoring that $10k was upfront, so would be $20k/8, so would appear as $2.5k each quarter.

Note: I'm NOT an accountant, so that is just my understanding of it. If you want to see if thats correct you need to discuss with an accountant, or someone who has knowledge of it.

Cdchi1