2 years WO deposit

[wizzszz]

I could be wrong, and please correct me if I am, but MA stated multiple times that their revenue is based SOLELY on deposits versus withdrawals. Ammo, bombs, decay, etc, are simply added to the loot pool. What we lose in-game is transferred between the hands of avatars, not the owners of the game. So despite his spiteful post, I'm going to need you to correct someone with well supported facts rather than highly fabricated myths.

MA has stated this? Where?

You appear to confuse something here:
When it comes to VAT, ofc this has to be paid on sales minus withdrawals - that's why it is listed on the official documents this way (a pure bookkeeping thing: VAT may be refunded later (i.e. on withdrawn money), so it's a temporary thing only)

But MA doesn't EARN money on PED sales, as you (or anyone else) could always withdraw them a day later - imo a no-brainer, no idea why this is always subject to disputes...

 

[KijkkiJikki]

I could be wrong, and please correct me if I am, but MA stated multiple times that their revenue is based SOLELY on deposits versus withdrawals. Ammo, bombs, decay, etc, are simply added to the loot pool. What we lose in-game is transferred between the hands of avatars, not the owners of the game. So despite his spiteful post, I'm going to need you to correct someone with well supported facts rather than highly fabricated myths.

MA has stated this? Where?

You appear to confuse something here:
When it comes to VAT, ofc this has to be paid on sales minus withdrawals - that's why it is listed on the official documents this way (a pure bookkeeping thing: VAT may be refunded later (i.e. on withdrawn money), so it's a temporary thing only)

But MA doesn't EARN money on PED sales, as you (or anyone else) could always withdraw them a day later - imo a no-brainer, no idea why this is always subject to disputes...

It's in MA's annual financial report. They specifically list deposits minus withdrawals as net revenue. PEDS held in game are listed as contingent liability. As people do activities that cause decay then overall contingent liability is reduced by that undisclosed percentage MA say they take. Obviously that's a good thing for MA as it reduces their risk and they can do other things with their capital. It's up to MA how much cash at hand they keep to manage the risk associated with their enormous contingent liability but it doesn't affect profit or net value until a withdrawal is made.

Regards,
KikkiJikki

 

[wizzszz]

It's in MA's annual financial report. They specifically list deposits minus withdrawals as net revenue. PEDS held in game are listed as contingent liability. As people do activities that cause decay then overall contingent liability is reduced by that undisclosed percentage MA say they take. Obviously that's a good thing for MA as it reduces their risk and they can do other things with their capital. It's up to MA how much cash at hand they keep to manage the risk associated with their enormous contingent liability but it doesn't affect profit or net value until a withdrawal is made.

Regards,
KikkiJikki

Did you post this to dispute or confirm my point?

Deposits go to 100% into contingent liability - that's NO profit, because that's value still owned by players.

Only ingame activity reduces this contingent liability, and that's where MA profits.



Or to rephrase it, deposits could be seen as "virtual profit", as long as there are no (not enough) withdrawals to cover these deposits, but MA did not "earn" this money, as it may turn into a "virtual loss" when it's withdrawn later.

"Virtual profit" - "virtual losses" = real profit.

Nonetheless they might have to pay taxes (and for sure have to deduct VAT) on the "virtual profit", but as soon as contingent liabilities are turned into "vírtual losses", these taxes are refunded.

 

[KijkkiJikki]

I posted to dispute your point.

Contingent liability has no impact on profit. It is merely an estimate of possible future liabilities. It is not until someone requests a withdrawal that an actual liability is incurred.

In game activity reduces risk but does not impact profit. Net revenue minus cost of business is real actual profit and is not virtual at all. It is a matter of company accounting and the rules and conventions governing that practice.

MA will be paying tax on net profit each year. If in one year withdrawals exceed deposits, then no tax is paid

regards,
KikkiJikki

 

[StonedSoldier]

Let me break it down for you in a very simple manner.

Consider a bank: You deposit your money into an account. With many people owning these accounts the money adds up. This money can be used by the bank for several other reasons, i.e loans.

Now consider MA your bank. Your game account is your account. The money you deposit is then put into your account. That money is then used by the bank however they see fit. Using other players deposits as a fallback for people withdrawing, MA can do as they want with the money. With a very small group of players consistently withdrawing PED and a large population continually depositing, MA profits. If everyone quits, then the PED lost by players through hunting, crafting, mining (contingent liability) still remains in the game for players to loot. However, if everyone quit and withdrew what they had, it leaves MA still in the green if the game fails. (due to the players loot pool still having a LOT of money to be collected)

The only time MA will ever *truly* profit from in-game events is when the game fails and the left over loot pool, i.e the money left over from deposits, remains in-game and their is no liability on their end to keep the remaining money.

Short and sweet: MA profit is as simple as money in-money out.

The loot table is based on us: decay, ammo, etc

Edit: Kijjik explains it in a way that can actually be understood, lol. I'm not in an accounting or business related job. Hell, I just got to college.

 

[KijkkiJikki]

Hi StonedSoldier,

The difference between MA and a bank is your bank deposits actually appear on their balance sheet and financial statements as a liability. A bank makes money from how it uses ur deposit to generate income through loans and other investments. That's why interest offered on deposits is generally lower than interest paid on loans. You bank deposits are not income for the bank.

MA on the other hand makes money because it acts on the assumption that in the long run, more money will be deposited than is ever withdrawn. Your Ped deposits are income for MA.

If everyone attempted to withdraw all their Peds...
Well not everyone could because there are a lot of small depositors who don't meet the minimum 1k withdrawal requirement. But if everyone who could, decided to withdraw, then MA would suddenly have a huge liability. Given that the don't maintain cash reserves to cover the whole amount, they would need to find a source of credit or prepare to go into receivership.

Regards,
KikkiJikki

 

[wizzszz]

I think you just confirmed my point of view, again - because this:

MA will be paying tax on net profit each year. If in one year withdrawals exceed deposits, then no tax is paid

is simply untrue - either the liabilities are seen as customers money, and then no taxes are paid on that money, because they are no income (profit) at all (altho it requires that MA meets certain requirements, i.e. some kind of trust fund where the money is kept, and MA may not even touch it), or, following you version, withdrawals exceeding deposits are considered losses, and MA will receive a refund of (overpaid) taxes (if withdrawals do not exceed deposits, these "losses" still lower the "profit", hence i labelled it "virtual profit", as in "temporary"...)

A company experiencing net loss can expect a refund of (overpaid) taxes from past (or future) fiscal periods, it works like that pretty much everywhere around the world - which kind of proves that PED sales are only seen as "temporary" (or "virtual") profits (until they are withdrawn or the related liabilities are consumed - by ingame activity!), no matter how you put it.

 

[Divinity]

A company experiencing net loss can expect a refund of (overpaid) taxes from past (or future) fiscal periods, it works like that pretty much everywhere around the world - which kind of proves that PED sales are only seen as "temporary" (or "virtual") profits (until they are withdrawn or the related liabilities are consumed - by ingame activity!), no matter how you put it.

Wizz, thats not how it works over here and doubt anywhere else in the world. Might be different in US but i highly doubt it. Refunds are mostly within fiscal if u have paid advance tax higher then nett payable tax at the end of the fiscal.

 

[KijkkiJikki]

wizzszz,

I guess we will just have to disagree on this. Tax laws do vary from country to country but if MA have a net loss in a year then they don't pay company tax. If they have paid tax for the year already then a refund is due. Not sure if you can accrue a loss into future years for taxation purposes but I don't think that is relevant anyway. Net profit or loss is net revenue - expenses
net revenue is deposits - withdrawals.

Peds in game are not liabilities. MA does not maintain a trust fund or bank account containing the real dollar value of Peds in game. Yes withdrawal of Peds does reduce net profit along with contingent liability.

It's all there in MA's financial statements.

Your arguement doesn't really make sense to me.

Regards,
KikkiJikki

On topic.... grats Gypsy

 

[slither]

back on topic (general economy forum for the argument)

Gratz on 2 years ands welcome to the gang, it's been 3 1/2 years for me

 

[Butch C]

back on topic (general economy forum for the argument)

Gratz on 2 years ands welcome to the gang, it's been 3 1/2 years for me

lets all stop depositing to be in the gang see how long the gang lasts.

 

[wizzszz]

Wizz, thats not how it works over here and doubt anywhere else in the world.

It works like that in the entire european union, and afaik, in every western county - ofc refunds cannot exceed what you have paid before...

Not sure if you can accrue a loss into future years for taxation purposes but I don't think that is relevant anyway.

Ofc you can, this is part of a lot of business strategies - and this is the most relevant point in this debate, because it disproves the whole "deposits are profit" thingie.



And tbh, i am a bit puzzled that you do not know that - let's say company A manufactures airplanes, and sells 100 of them, every third year - but in between, for two years the do not have any income at all... but expenses, from wages, buying parts and so on...

Do you really think they have to pay full tax on the sinle good year, and cannot take into account losses in the 2 bad years before? Nobody would build airplanes anymore, because it would simply not pay...


Even if you buy a computer as an employee (who needs a computer at home) this are tax-deductable expenses - spread over 3 years (3 years over here), a thing commone to tax laws - this is not so different in between countries...
So one might think it is common knowledge that tax is not a "year-by-year" thingie, not even for employees.


But let's end it here, this is going nowhere.

 

[Gandy]

Opposite of me sadly

grats
deposit more so i dont have to!
up to 110 deposits in 12 months

 

[Thorn]

Gratz! I`ve went quite a long time without deposit in the past. I`ve also seen PED get eaten up on the other side of the coin. I lasted shy of 2 years off a uber mining claim but it was all downhill from there. It`s funny I can almost feel when my PED is about to be drained. I think a lot of it is the discipline to be able to say no when your tempted to go on the longshot hunts on big mobs etc. It helps to have a plan too.

Keep it up! Someone has to.