It is a truth universally acknowledged that a company can't do business withnegative net assets. But next year, operating in the red may become morecommon. That is the upshot of a presentation given last week by the first companyin either the US or Europe to issue in-depth guidance on the effect of the newrevenue accounting rules that take force next year.    This piece will discuss three issues. First, how the new rules will completely wipeout net assets and cause significant profit cuts for some companies. Second,how investors need to adjust their valuation frameworks. Third, which companies,particularly in the technology sector, are likely to be affected.    The unexpectedly severe outlook was confirmed last week by an unusualsource. The quiet British company Capita revealed that the new accounting rules(IFRS 15 or ASC 606) would have cut last year's earnings by one-third andcompletely erased its net assets - a positive balance of ￡483m turned into -￡553m.    Furthermore, this negative level will persist for the foreseeable future.

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