Latest news with #AlexanderE.Parker
Business Upturn
4 days ago
- Business
- Business Upturn
Daily Journal Corporation Provides Additional Public Access to its New Form 8-K
LOS ANGELES, Aug. 14, 2025 (GLOBE NEWSWIRE) — Daily Journal Corporation is issuing this press release to provide additional public access to the Form 8-K it filed earlier today with the Securities and Exchange Commission in response to the continued interest in our software accounting from Buxton Helmsley USA, Inc. and its Chairman and CEO, Alexander E. Parker. Below is the text of our Form 8-K. Item 8.01 Other Events. In July, the Company started receiving letters from an investment adviser called Buxton Helmsley USA, Inc. ('BuHeUI') alleging that the Company has been improperly expensing its software development costs and should be capitalizing them under the accounting requirements set forth in ASC 985-20, Costs of Software to be Sold, Leased or Marketed ('ASC 985-20'). According to BuHeUI and its Chairman and CEO, Alexander E. Parker, switching from expensing development costs to capitalizing them would unlock value for Company shareholders, and he demanded a 15% share in the appreciation of the Company's stock price as compensation for his idea. He pointed to Tyler Technologies and Galaxy Gaming as proof that other software companies 'properly comply' with ASC 985-20 by capitalizing their development costs. Simply stated, Mr. Parker got it wrong. Following receipt of his initial letters, the Audit Committee of the Board re-reviewed the applicable accounting guidance and the Company's practices with its accountants and with third party experts. All agree that the Company has been correctly accounting for its software development costs in accordance with ASC 950-20. To understand Mr. Parker's mistake requires a brief explanation of the relevant accounting standards. Historically, most software companies accounted for development costs under ASC 985-20, which establishes the requirements a company must meet to capitalize those costs when associated with software to be sold or licensed to a third party. A company is only allowed to capitalize costs incurred during the period after the technological feasibility of the software has been established and prior to its general release. Ironically, one of the main accounting concerns in the past had been that companies would capitalize too much and too soon, because it helped improve their short-term earnings by reducing expenses and moving them to the balance sheet (or, as Mr. Parker might say, 'unlocking value'). Moreover, the process of software development has substantially evolved at many companies since the initial ASC 985-20 guidance was issued, with most companies now applying an agile software development methodology that emphasizes iterative development in a continually changing environment. This results in the capitalization window between technological feasibility and general release to be so short that few companies incur any material amount of costs that would qualify for capitalization. The Company's software products and our agile development efforts are in that camp. In addition, with the growing popularity of software-as-a-service (or 'SaaS'), companies that make predominately SaaS software take the position that their software is being developed for 'internal use' because their customers are purchasing access to a hosted product, rather than actually receiving the software. This is important because 'internal use' software is accounted for under an entirely different accounting standard : ASC 350-40, Internal Use Software ('ASC 350-40'). You should expect to see more capitalized costs for a SaaS company taking this position because ASC 350-40 provides that eligible costs can be capitalized over a typically much longer development window compared to the short window for 'external use' software (like ours) under ASC 985-20. Neither Galaxy Gaming nor Tyler Technologies expressly states in its public filings which accounting guidance it used to capitalize costs, and we suspect Mr. Parker simply assumed it was ASC 985-20. He appears to have been mistaken. Galaxy refers in its 10-K to ' internally developed software ' in its consolidated statements of cash flows, and Tyler refers in its 10-K to the 'amortization of software development for internal use ' in its G&A expenses. This means, in both cases, that they are likely capitalizing costs for 'internal use software' under ASC 350-40 – not ASC 985-20. And, yes, the Company does offer some SaaS enhancements to our eSeries products, but the Company would not qualify for ASC 350-40 treatment because the vast majority of our software continues to be licensed to customers (almost entirely courts and government agencies) to whom we deliver the software, with those customers arranging for hosting based on their own security and operational needs. Lest there be any doubt, the Company has and will continue to expense development costs when that is the proper thing to do, and it will capitalize any such costs in the future when that is the proper thing to do. It will also disclose any specific R&D costs separate and apart from other expenses, if material. Mr. Parker may never admit that he was wrong or that he simply misunderstood why other software companies are capitalizing development costs, given that they appear to be using a completely different accounting standard than the one cited in each of his nine letters so far. At a minimum, he should be embarrassed for demanding compensation from the Company, alleging securities law violations, calling for the resignations of the CEO and CFO, insisting on being given two Board seats, reporting the Company to the enforcement division of the SEC, referring the Company's auditor to the Public Company Accounting Oversight Board, alleging wild conflicts of interest by our directors, and falsely claiming defamation – all based on a mistake. Mr. Munger once offered some sage advice that may be useful for Mr. Parker, who is currently advertising on his website for new investors to entrust their money with him and his approach: 'There's no way that you can live an adequate life without many mistakes. In fact, one trick in life is to get so you can handle mistakes. Failure to handle psychological denial is a common way for people to go broke.' On behalf of its shareholders, the Company calls on Mr. Parker to do the right thing and end his misplaced, self-serving attacks on the Company and its people, so that they can focus their attention on unlocking actual business value. # Contact: Jessica Marshall (778) 716-6706 Disclaimer: The above press release comes to you under an arrangement with GlobeNewswire. Business Upturn takes no editorial responsibility for the same. Ahmedabad Plane Crash
Business Upturn
01-08-2025
- Business
- Business Upturn
Daily Journal Corporation Provides Additional Public Access to its Recent Form 8-K
Contact: Jessica Marshall (778)716-6706 LOS ANGELES, July 31, 2025 (GLOBE NEWSWIRE) — Daily Journal Corporation is issuing this press release to provide additional public access to the Form 8-K it filed earlier this week with the Securities and Exchange Commission in response to the incredible interest in our software accounting expressed by Buxton Helmsley USA, Inc. and its Chairman and CEO, Alexander E. Parker. Below is the text of our Form 8-K. You can also visit our website at for copies of Mr. Parker's correspondence. Item 8.01 Other Events. Two weeks ago, we received a letter from Alexander E. Parker at a firm called Buxton Helmsley USA, Inc. The letter said Daily Journal Corporation (the 'Company') should be capitalizing software development costs instead of expensing them under GAAP, and that doing so would 'unlock $160+ million in incremental equity value' for shareholders. Mr. Parker then asked for a consulting engagement that would pay him $24 million worth of Company equity if the stock price increased by that amount for any reason (i.e., $.15 of every dollar), and he asked for two seats on the Company's Board of Directors. His initial July 14 letter is attached as Exhibit 99.1, and his follow-up letter dated July 18 (demanding an emergency Board meeting) is attached as Exhibit 99.2. According to the SEC's website, neither Mr. Parker nor Buxton Helmsley is registered as an investment adviser with the SEC. The Buxton Helmsley website says that Mr. Parker is licensed by FINRA, but according to the FINRA website, he is not registered as a broker or investment adviser. His LinkedIn page says that Mr. Parker attended Mercy University from 2014 to 2016. Mr. Parker seems to fancy himself a whistleblower, but the Company has been disclosing its practice of expensing software development costs and the reasons for that in its public filings for more than a decade. Nothing is hidden. The Company is well aware of the accounting rules under ASC 985-20, Costs of Software to be Sold, Leased, or Otherwise Marketed, and those rules require a continuous facts-and-circumstances analysis. The Company believes the accounting for its eSeries® product line development efforts is, and has been, correct. Furthermore, the Company's approach has been reviewed as part of the annual audit without issue by three different national accounting firms since those development efforts began. Mr. Parker is right that if the Company capitalized those costs, it would boost near-term earnings and asset values by reducing the Company's expenses and shifting them to the balance sheet. Anyone who knew our longtime Chairman, Charles T. Munger, knows what his thoughts would have been on the idea of 'creating value' through accounting. Nonetheless, the Board and its Audit Committee decided to take this opportunity to engage an independent accounting consultant to make sure the Company is accounting for software development costs correctly. And that's when Mr. Parker's game became clear. On July 23, one day after being informed of the decision to engage an independent accounting firm rather than Buxton Helmsley, Mr. Parker fired back a letter saying that only Buxton Helmsley was qualified to 'restore trust' while at the same time notifying us that he was reporting the Company to the Enforcement Division of the SEC. That letter is attached as Exhibit 99.3. You should read it. We suspect Mr. Parker will learn with age and experience that few people want to work with someone who presents himself this way. Even fewer want to work with someone who reports them to the government when he doesn't get what he wants! Also, we've already reached out to the SEC staff and have offered to discuss with them the Company's software development accounting and/or Mr. Parker, should they so desire. Finally, we are attaching an email chain with Mr. Parker as Exhibit 99.4, and Mr. Parker's fourth letter, this one dated July 25, as Exhibit 99.5. This most recent letter is addressed to Company stockholders and calls for the immediate resignation of both the Company's CEO and its CFO. Remember, all that's happened here is that the Company's Audit Committee decided to engage an independent accounting consultant instead of him! After considering Mr. Parker's analysis, his demand for equity compensation and his threats should the Company challenge him (see page 5 of the July 23 letter in particular), we suspect Company shareholders will agree that the Audit Committee made a prescient and wise decision in not 'partnering' with Mr. Parker. Item 9.01 Financial Statements and Exhibits. (d) Exhibits 99.1 Letter from Buxton Helmsley USA, Inc., dated July 14, 2025. 99.2 Letter from Buxton Helmsley USA, Inc., dated July 18, 2025. 99.3 Letter from Buxton Helmsley USA, Inc., dated July 23, 2025. 99.4 Various correspondence Alexander E. Parker between July 14 and July 23, 2025. 99.5 Letter from Buxton Helmsley USA, Inc., dated July 25, 2025. 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) # Disclaimer: The above press release comes to you under an arrangement with GlobeNewswire. Business Upturn takes no editorial responsibility for the same. Ahmedabad Plane Crash
