Apple sales will 'increase'

THE TRUE and holy Apple religion is certain to report a big increase in sales next year.

While the tame Apple press and fanboys will be trying to convince the world that Jobs' Mob is taking over, in fact it will be nothing more than an accounting sleight of hand.

It is likely that sales of Apple gadgets will increase a little bit, but it will be fairly pointless trying to say things like "they did a lot better than last year".

According to the AP, that is because regulators have approved a change to the way certain IT companies report sales and profits to investors. These rules caused a headache for outfits like Apple that flogged a product that was a mix of hardware and software.

Until now Apple had to spread revenue from the sale of an Iphone over the two years that it considered the gadget's useful life. This was mostly because Jobs Mob agreed to provide software updates after the sale.

Now the Financial Accounting Standards Board's latest changes mean that Apple can "unbundle" Iphone hardware from its software and report the hardware sales when they occur.

In the long term this is a good thing because it allows investors to see how Apple did in any given period.

However in the short term it will lead to some strange accounting effects. Last quarter Apple said that if it were allowed to account for Iphone sales all at once, its sales would have been 17 percent higher and its profit would have been boosted by 58 percent.

So what will happen is that the next returns will show a huge boost in sales and profits without Apple having done anything other than change the way its beancounters do their sums.

It is not clear when Apple will bring in the new changes. It has to do so by the middle of next year, but can bring them in straight away.

But if you see a press release saying that Iphone sales have gone up by about 20 percent on last year and profits by 60 percent you will know why. µ