This is an interesting business operation, and no doubt a very much needed and demanding service for many who want a quick way out of the airport, Mahattan is approx 40 miles from JFK. If your building has a heliport better yet! :))). As that may be things to consider before taking on an investment with this company. Its 2 years old, and relatively new, it will take time to see if this develops into a really profitable enterprise.
U.S. HELICOPTER CORPORATION
NOTES TO FINANCIAL STATEMENTS
(2) GOING CONCERN (CONTINUED)
$22 million through $12 million of operating lease financing and $10 million
of some combination of debt, equity or SEDA draws, we would have sufficient
funds to meet our needs for working capital, repayment of debt and for capital
improvements over the next 12 months. There can be no assurances, however, that
we will be able to complete such financings on terms favorable to us or at all.
(3) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent assets and
liabilities at the date of the financial statements, as well as reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
CASH EQUIVALENTS - We consider all highly liquid investments with original
maturities of three months or less when purchased to be cash equivalents. We had
no cash equivalents at September 30, 2007.
RESTRICTED CASH - We had restricted cash of $180,071 at September 30, 2007. Our
restricted cash at September 30, 2007 related to a cash deposit securing a
letter of credit we were required to post.
CONCENTRATIONS OF CREDIT RISK - Financial instruments that potentially subject
us to significant concentrations of credit risk consist principally of cash and
cash equivalents and accounts receivable.
We maintain our cash and cash equivalents in accounts with major financial
institutions in the United States in the form of demand deposits and money
market accounts. Deposits in these banks may exceed the amounts of insurance
provided on such deposits. As of September 30, 2007, we had approximately
$147,880, in deposits subjected to such risk. We have not experienced any losses
on our deposits of cash and cash equivalents.
We generally do not require collateral related to our financial instruments.
Concentrations of credit risk with respect to trade accounts receivable are
limited due to the fact that most customers pay for the flights in advance of
the flights. The allowance for doubtful accounts as of September 30, 2007 was
$0. We routinely assess the financial strength of customers and, based upon
factors concerning credit risk, we establish an allowance for doubtful accounts.
Management believes that accounts receivable credit risk exposure beyond such
allowance is limited.
FAIR VALUE OF FINANCIAL INSTRUMENTS - Statement of Financial Accounting
Standards ("SFAS") No. 107, "Disclosure about Fair Value of Financial
Instruments," require the disclosure of fair values for all financial
statements, both on- and off-balance-sheet, for which it is practicable to
estimate fair value. We estimate that there are no material variations between
fair value and book value of our financial assets or liabilities as of September
30, 2007.
PROPERTY AND EQUIPMENT - We record our property and equipment at cost less
accumulated depreciation. For financial reporting purposes, we use the
straight-line method to compute depreciation based upon estimated useful lives
of two to five years for flight equipment and one to seven years for other
equipment. Leasehold improvements are amortized over the shorter of the related
lease term or the estimated life of the improvements. Equipment under capital
leases are amortized over the lease term and such amortization is included in
the depreciation of property and equipment. Upon selling or otherwise disposing
of property and equipment, we remove cost and accumulated depreciation from the
accounts and reflect any resulting gain or loss in earnings. Depreciation and
amortization totaled $311,592 and $161,081 for the nine months ended September
30, 2007 and 2006 and $96,553 and $82,012 for the three months ended September
30, 2007 and 2006, respectively.
IMPAIRMENT OF LONG-LIVED ASSETS -We review our long-lived assets and
identifiable intangibles for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. When such factors and circumstances exist, we compare the projected
undiscounted future cash flows associated with the future use and disposal of
the related asset or group of assets to their respective carrying amounts.
Impairment, if any, is measured as the excess of the carrying amount over the
