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  "documentTitle": "Olam International Ltd. (SGX:O32)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson Block",
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  "presentationDate": "2012-11-27 00:00:00",
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  "notes": "The text argues that Olam's negative goodwill is not 'real' income and expresses skepticism regarding asset revaluations.",
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      "text": "There are two critical points to make about Olam’s negative goodwill. First, negative goodwill is not “real” income in that there is no positive cash flow associated with it when booked.",
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      "text": "negative goodwill: S$210.4 million",
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      "kind": "paragraph",
      "text": "accounting is, in our view, one of the primary reasons Enron collapsed. These gains encouraged Enron to spend substantial amounts of cash on low to negative return projects, which is what we think Olam is doing now.",
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      "text": "Olam booked small amounts of negative goodwill in FY2008 and FY2009. The stakes escalated greatly in FY2010 when Olam booked S$118.2 million in negative goodwill... Olam recorded another S$79.8 million in negative goodwill in FY2011.",
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      "text": "We think analysts and investors are missing a major point regarding Olam's negative goodwill. Much of its negative goodwill comes from revaluing assets at the time of acquisition, rather than it acquiring them below their book values.",
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      "text": "More important though is that at least 62.5% of Olam's negative goodwill resulted from acquisitions in which Olam increased the values of the acquired assets... Olam revalued the PP&E upward by S$73.1 million (62.6%).",
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