High tech companies, though, are being accused of financial practices that go much further than simply massaging earnings for cosmetic purposes.
Some analysts fear that tech investors are being intentionally misled by inflated financial reports.
In the absence of profits, the valuation of dot coms are primarily judged by revenue, a number open to many interpretations. According to Brett Truman, professor of accounting at University of California at Berkeley's Haas School of Business, many tech companies have been tempted to inflate their revenues because of the unrealistic growth expectations imposed on them by investors. This is a zero-sum game, which in the end results in zero true revenue. But as an investor looking at revenue numbers, you might not know the difference. This kind of bartering scheme is especially prevalent in Internet advertising.