This article appeared at 12:00 p.m. EDT on RealMoney Sept. 8.
SAN DIEGO (RealMoney) -- Alibaba, not surprisingly, is likely to be a hot deal. And, not surprisingly, most investors -- especially those who trade the deal -- are unlikely to crack open the prospectus. (I'd go so far as to say most don't know what a prospectus is, but I digress.)
If they do, there will be no way they will be able to say with certainty that Alibaba is an analyzable company (certainly not for those who intend to invest in the company rather than play the stock).
Ignore the pictures of founder Jack Ma and the smiling people. Ignore the colorful charts and the tables showing how fast the company is growing and how big its potential market is.
They're all an effort to get you to gloss over just how complicated Alibaba really is, and complicated often equals trouble.
Any efforts to untangle this company require more than any old genie. They requires a forensic accounting genie.
And never mind the one-time expenses, payments and investment gains.
Alibaba is just too darn complicated, starting with the footnotes. Footnotes are common in financial filings, but when it comes to footnotes reconciling the various financial statements, Alibaba takes them to a new level, such as these below the consolidated financial statements:
In fiscal year 2014, these expenses included an equity-settled donation expense of RMB1,269 million (US$205 million) relating to the grant of options to purchase 50,000,000 of our ordinary shares to a non-profit organization designated by Jack Ma and Joe Tsai.