November 23, 2014

Accounting for flagship Apple stores changed

Accounting-for-flagship-Apple-stores-changed-1As a new Securities and Exchange Commission filing reveals, Apple has adopted another way to handle accounting to its high-profile retail stores. Prior to the fiscal first quarter of 2012 that ended on December 31st, the tech giant owned 20 flagship retail outlets treated separately in financial terms. Certain costs associated with high-profile Apple stores, opened to serve as vehicles for marketing activities and corporate sales and promote brand awareness, were previously allocated to corporate expenses.

Starting with fiscal 2012, these costs are no longer offloaded to corporate ledger, the company writes. The expenses are instead being kept within Apple’s retail segment. For unspecified reason, the Cupertino handset maker has in fact reclassified $24 million in store costs of the 2011 fourth quarter.

On average, the company has expensed $95 million annually to corporate over the past four years. Amounting to $1.8 billion in total, this sum is only 1.3% of Apple’s revenue for this year’s first quarter. Though it isn’t certain which specific stores qualify as “high-profile”, they are likely to include outlets like the Grand Central or the Fifth Avenue locations in New York City or the Shanghai Pudong store.

Accounting-for-flagship-Apple-stores-changed-2

Related Posts

Comments

  1. guest says:

    Apple was writing it off as advertising… They were also expensing the manager and genius salaries as a corporate expense and not on the retail side.

Speak Your Mind