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Oh, and for those who haven't seen it, here is the "countdown clock" for SCRC
www.datecountdown.com/?&d=11%2f15%2f2014+8%3a13+PM&t=SCRC+Countdown+to+Profitability+Q3
One can hope that there is a good Sept # that will hit early next week to get a bounce and that there is some validity to the CFP rumor for mid Nov.
by the end of October we're closer to $.14
At least, if I was a bigger player, I would start talking this thing up in Q4, telling my buddies etc... gotta get in before it rips. This stock just seems primed to go on a tear.
Have you participated in FNMA? Trades on the OTC and is under $5. Owned by Paulson, Perry and Berkowitz. I am not saying SCRC is even close to FNMA but just saying that hedge funds do by under $5 stocks. Look at CERS as that is under $5 and heavily owned by the Baker Bros who are a biotech/healthcare long only hedge fund. If the revenues are what they say they are and the business keeps improving, this company will make its way over $1. If even more growth occurs with Rapimeds and other products in the pipeline, who knows eventually, maybe even the Baker Brothers buy into this. I know personally that you do not have to be above $5 for hedge funds to buy. With that being said, of course they won't by a .09 stock. The growth of the company is what is on the spotlight right now. Can this company keep growing and opening up their pipeline. It is all about the pipeline in Pharma as we all know.
Seems very quiet lately on this board and elsewhere. Makes you wonder what is up or coming.
This is unreal. If the numbers are correct, and I would think the Bob wouldn't be stupid enough to put our PR that was false, this thing should be much higher than it is now. And you are correct, they will put out PR stating some number around $4.9M for September and the market will yawn. That is what scares me. What is the market seeing or not seeing that we don't? Is it waiting for a audited 10Q to come out?
DILUTION UPDATE:
Approx 4.8M of the .05 PIPE shares unlocked in JUL, and it was evident by the tape that the vast majority of these shares got dumped as the CORE PIPE-holders were eager to take some guaranteed profits off the table. So very little still lurking in the float, IMO.
Approx 5.2M of the .05 PIPE shares unlocked in AUG, and based on the tape, I would say that it would be a safe ballpark estimate to surmise that at least 2/3rds of these got dumped as well. Remember, this is NOT one entity holding all the PIPE shares. We have approx 30 distinct individuals who are known penny flippers each making their own decisions. So clearly, some completely cashed out while others only partially cashed out hoping for another runup to reap larger gains. So still quite a bit still lurking in the float.
Approx 6.8M of the .05 PIPE shares were reported to have been issued in MAR-14, so these have unlocked and will continue to unlock thru the end of this current SEP month. In addition, the Q2 Q disclosed that on 4/1/14, 1.6M more .05 PIPE shares were issued; with a 180-day lockup period, these 1.6M shares will become free-trading on 9/28/14. So, what this means is that by the time 9/30/14 rolls around, we will have seen 8.4M total .05 PIPE shares hit the float just in the month of SEP alone. And so far, by looking at the tape, it would appear that less than half of the 6.8M that have unlocked so far in SEP have been dumped. So quite a bit still lurking in the float.
The Q2 10Q provided a little bit more details re: the Q2 PIPE issuances, so here is what we can expect over the next few months. Note that I am ONLY listing those shares that were priced sub-.10 and NOT the total dilution – reason being that for the vast majority of the dilution that is priced at .12+, these are unlikely to get dumped anytime soon, at least not until the sp gets into the high teens, IMO. By my estimation, there is still approx 20M “higher-priced” shares that have either unlocked but are still lurking in the float or have yet to unlock but will enter the float over the course of the next few months.
So, without further ado, here are the sub-.10 shares that will be hitting the float in the near future:
OCT 5, 2014
925k shares held by Seaside priced at .066
OCT 5, 2014
200k PIPE shares priced at .05
OCT 13, 2014
370k PIPE shares priced at .05
NOV 1, 2014
782k shares held by Seaside priced at .0618
DEC 10, 2014
756k shares held by Urbanski (related to the GEM cancellation settlement) priced at .0665
DEC 14, 2014
500k PIPE shares priced at .05
DEC 16, 2014
200k PIPE shares priced at .05
DEC 27, 2014
580k PIPE shares priced at .05
BETWEEN JAN 1, 2015 and FEB 4, 2015
1M PIPE shares priced at .05
So… …the good news is that the amount of deeply-discount dilution entering the float is decreasing; however, the bad news is that there is still too much of this deeply-discounted dilution that has already entered the float that has NOT flushed thru yet. As I’ve been saying, it ain’t easy liquidating 30M+ shares of 0.00 and 0.05 shares when the market will only provide 100k-300k shares worth of liquidity each day, LOL…
BUT, IMO, the most critical news we need to know is actually unrelated to dilution; it is related to the impact the new insurance coverage restrictions on compounded drugs is having on Main Ave (as well as on UA, and JJ’s). Remember, 9/15/14 was the implementation date for most employers (excluding large employers), and 1/1/15 is the implementation date for the large employers, so seeing OCT-2014 and JAN-2015 Main Ave numbers will be extremely important. If SCRC can demonstrate that it can still generate and maintain an annual revenue run rate of at least $30M in the “post-compounding-restriction-era”, then IMO this – combined with what will hopefully be the elimination of any further PIPE issuances -- will remove a lot of risk from the equation.
And the market will recognize this if and when it happens and react accordingly in a favorable manner should it come to fruition and be corroborated by the Q1’15 10Q, IMO…
Got an interesting question via PM today. The question posed to me was what SEP numbers I thought SCRC would PR during the first week of OCT. The question was specifically asking what would be PR'd -- and NOT what the revenues would be or what the "approved orders" would be... ...but very specifically what SCRC would PR.
That is a very interesting question indeed.
Let's start with what we know:
(1)
We know that SCRC has a history of PR'ing numbers that DO NOT BELONG TO IT.
Case in point: WRx.
For those who have been around since Q4'13, you may recall that SCRC regularly PR'd "record-breaking revenues for WRx" and PR'd several hundred thousand dollars in WRx revenues each month. But what SCRC did not disclose in the PR's is that WRx is an unrelated 3rd party entity that SCRC does NOT own, and that the agreement SCRC has in place w/WRx stipulates that SCRC will only receive a commission that amounts to only 14% of GROSS PROFITS -- not even 14% of revenues, but 14% of GROSS PROFITS.
And what SCRC ultimately was forced to disclose in its Q's is the fact that it really only took in between $10k-$30k per month, and thru Q'142 has only realized approx $150k in total commission revenues SINCE THIS AGREEMENT w/WRx TOOK EFFECT 13 MONTHS AGO.
And what the most recent Q has shown us is that WRx revenues are not only no longer growing, but they are also not even plateauing/flatlining -- rather they are steadily declining.
(2)
We know that SCRC will sneakily change the language/wording of its PR's and subtly switch out one metric for another w/o telling its audience that it has done so.
Case in point: Main Ave
During Q2, although SCRC continued to faithfully PR the Main Ave financial results almost immediately following the conclusion of each and every month, it very subtly altered the language in describing the reported numbers from "Revenues" to "Approved Orders". In hindsight, once the Q2 Q came out, it became apparent that the reason for this was the growing backlog at Main Ave. Why is this important? Because for orders that are backlogged, if Main Ave can't get them shipped out by month-end, they cannot bill the insurance companies for the Rx's and CANNOT RECORD THE "APPROVED ORDERS" AS REVENUES.
So, instead of reporting declining revenues due to the growing backlog holding things up, SCRC simply reported "Approved Orders". Again, this is something yu can verify for yourself by going back thru the Q2 PR's and comparing the PR'd numbers to the Q2 revenues reported in the Q. You will find that SCRC PR'd Q2 "Approved Orders" of $5.3M but only recognized $3.5M as revenues.
**************
So, knowing the above as being deceptive tactics that SCRC has employed previously, what does that tell us about what SCRC will PR for SEP numbers?
IMO, there are several potential scenarios:
(A)
SCRC can continue to simply PR Main Ave "Approved Orders" only.
(B)
SCRC can begin reporting numbers for "Specialty Pharmacy Operations" in aggregate to capture not only Main Ave but also United Apothecary and Jungle Jim's.
BUT, if SCRC does this, be careful because SCRC effectively owns Main Ave and plays the role of pharmacist there and gets to recognize the full Rx insurance payment as revenues; however, for UA and JJ, SCRC is merely some type of sales rep or broker that will receive an unspecified commission-like % of the Rx insurance payment.
So, SCRC may mix apples and oranges by PR'ing some combination of the following:
* Main Ave RX Revenues
* Main Ave Rx Approved Orders
* UA/JJ Rx Revenues (which belong to UA/JJ and NOT to SCRC)
* UA/JJ Rx Approved Orders (which belong to UA/JJ and NOT to SCRC)
* UA/JJ Earned Commissions based on Rx Revenues
* UA/JJ Earned Commissions based on Rx Approved Orders
And let's not forget about PIMD. Per the Q, SCRC will receive a Mgmt Fee equal to 45% of some unknwon "Calculation Basis". So will SCRC PR anything re: PIMD? If so, will it be
* The Mgmt Fee SCRC receives(i.e. 45% of the Calc Basis based on actual "revenues")?
* Or the Mgmt Fee SCRC receives (but 45% of the Calc Basis based on "Total PIMD Orders Received")?
* Or will it be simply the gross "Total PIMD revenues"?
* Or will it be the gross "Total PIMD Orders Received"?
So if we think back to the mathematical concepts of combinations/permutations, we can see that with the 10 different variables here that it will be impossible to know what/how SCRC will PR. All we can do is wait or the PR to come out and then be very diligent in vetting it, paying special attention to the words utilized.
Hope this helps...
Interesting comments hanging out in the public space tonite:
toward the end of the day it appeared that someone was really trying to buy cheap stock
Celtics is doing a tremendous job for this company
I think it was magical that SCRC closed green today
Ironridge Global IV, Ltd. Successfully Obtains Final Enforcement Order Against ScripsAmerica, Inc.
www.wset.com/story/26273926/ironridge-global-iv-ltd-successfully-obtains-final-enforcement-order-against-scripsamerica-inc
Rinse & repeat!
The criminal JOSEPH ZAMPETTI and his fellow CORE PIPE-holders are apparently dusting off yet another of the same recycled pleas to the public as to why everyone should hold their shares because (gasp!) he and the other CORE PIPE-holders wouldn't even think of selling their 0.00 and 0.05 shares because they are afraid of taxes.
OK, so now that I have picked myself off the floor from laughing so hard...
(1)
Every sober investment professional will tell you that you NEVER make investing decisions based upon fear of short-term taxes. Decisions to hold/sell should be made strictly based upon the merits of the investment vis-a-vis your risk profile, objectives, time horizons, changes in company performance, changes in company fundamentals, news, etc.
(2)
Every retail investor has a number of losing trades; no one has only winning trades. The tax law is structured so that any gains can be offset against losses from other trades. So this blunts any tax impact. In addition, even if a retail investor is fortunate enough to have net short term gains, these can then be further offset against any LONG-term losses. So the tax impact is potentially even further blunted.
(3)
A CORE PIPE-holder can specify which shares to sell. With an overall portfolio whose avg cost has now been significantly reduced thanks to the 0.00 and 0.05 shares, a CORE PIPE-holder can easily elect to sell higher priced shares to avoid or minimize any short-term gains to begin with. Once the shares are in your portfolio and your new avg cost is set, it makes ZERO difference which specific shares get sold.
(4)
Many retail investors now invest/trade out of tax-advantaged accounts (with the Roth IRA being just one example). For these shareholders, there are no tax implications whatsoever from short term trading.
Apparently, JOSEPH ZAMPETTI and the other CORE PIPE-holders need to be held by the hand yet again...
The existence of any breathing human being performing in the capacity of a "National Sales Manager" is wholly irrelevant to whether or not SCRC gets the commission revenues from any Rx's referred to United Apothecary and Jungle Jim's (UA/JJ).
As I explained in my prior post, what will impact the amount of commission revenues SCRC gets is whether the salespeople are legally employed by SCRC or are independent contractors. And from SCRC's SEC filings, they are apparently independent contractors. This is supported by not only SCRC's own disclosures that the company headcount is only 3 (with the 3rd only having been hired in late JUN-2014 and the other 2 being the CEO and CFO) but also by how the financial statements are reported.
Once again, if the salespeople are independent contractors, how would SCRC be able to step in between them and UA/JJ and say that UA/JJ has to pay SCRC the 45% commission? The actual salesperson will get most if not all of the 45%. The mystery is exactly what % SCRC will get under the agreement and what exactly it is that SCRC is even doing to earn anything at all??? As I theorized in my prior post, the only thing I can think of is that SCRC has pre-disclosed the names of the salespeople and so any Rx's routed to UA/JJ from these salespeople will result in SCRC getting a form of a "finder's fee" similar to that of a broker who brings two parties together. In any event, I can't imagine a scenario where the actual salesperson is willing to give up a significant chunk of the 45% commissions. Why would they? If you were the salesperson, and the allocation to SCRC becomes too high, wouldn't you simply route the Rx to another pharmacy and collect the full 45% for yourself?
The mis-information being disseminated into the public space by JOSEPH ZAMPETTI and his CORE PIPE-holders continues to be head-shaking. Egads, this is simply too easy...
Incidentally, on another forum, it was stated that S.C.R.C. would gain little benefit because they have no sales force. That is completely false as we have a National Sales Manager and I might ask how can we get the massive sales volume at M.A.V. without a sales force .
Clearly someone is intent on driving this down. Trying to scare some additional shares or is it the pipe holders selling?
Paint that close: $52.45 + Commission.
Interesting trading after this morning's press release, down 18% on 150k shares.
ScripsAmerica, Inc. (OTCBB: SCRC) today announced that the Company has entered into a prescription sourcing agreement with Ohio-based Jungle Jim's International Market, which has pharmacy licenses in several states.
The Company will obtain prescriptions to be filled by "Jungle Jim's" within its areas of drug delivery licensure and receive a percentage of the revenue generated by each prescription upon its reimbursement by insurance providers. With this agreement, ScripsAmerica has expanded its specialty pharmacy operations by gaining access to have prescription drugs distributed in 12 new US states.
@PEACHMAN,
Yes, green is good!
CHP, are these 40M factored into the current Outstanding #?
what you all are witnessing is the shear underlining-undervalued stock price gaining traction on very strong PR business at hand due diligence by the CEO - Mr. Bob Schneiderman and what awaits this mega star rising comapany moving forward and revenue operations!!!
Food for thought to the savy investor :> Why would I or should I buy stock in a company like ScripsAmerica Inc.thats on the verge of being "cash flow positive" based on astronimical revenue numbers, continued growth in all aspects of business operations, fantastic shareholder base, a very low trading float of 75 million shares, a super class act CEO running the company, and most of all your god given right to choose the over other 50,000 garbage/scam companies to invest in on the OTCBB
if a group as you say, knows how successful SCRC has the potential to become ,why would they sell early when potential is just beginning to expand?My guess is they will wait until pps is much much higher.
Another GREEN day for SCRC
Lots of big fish to fry and little staff, many go unnoticed ...some don't
That is a good question. My other question would be. If someone was calling me a criminal and it wasn't true. I certainly would waste no time calling them out on it. To my knowledge "Old Joe" has never posted in here that CHP is in fact a liar and proved it.
CHP,if there is violations occurring in section 17(b), why hasn't the SEC gotten involved?
I see there is a "profitability clock" counting down to November 15th.
More examples of "the blind leading the blind" being disseminated into the public space:
Its been reported that in some instances, it may not be necessary to pay selling costs until payment has been received for a delivered prescription.
However, if the costs are not prepaid, they must be placed on an accrual or reserved basis. When on an accrual basis, the funds can not be touched until actual receipt of the funds. Thus, it has the same effect as a prepayment.
A low cost Factor is still the best alternative.
While I was researching United Apothecary's licenses in TN, I came across this website that provides links to each state's licensing body's website:
http://www.healthguideusa.org/pharmacy_license_lookup.htm
It is possible that I may have missed something as I searched thru these quickly, but from what I have been able to gather from searching each state's respective database, I found that Main Ave holds a current active pharmacy license in only 4 states:
New Jersey
New York
Florida
Texas
I had thought that I read somewhere early in the year that Main Ave was licensed to fulfill compounding Rx's in 7 states?
NJ makes sense as it is its home state. NY and TX are excellent states for no other reason than the sheer size of the population there. And FL is good to have due to its high population of seniors as this demographic has a higher per capita need for topical pain creams.
I am surprised that we have not heard anything from SCRC re: licensure applications to other states for Main Ave. This would be important news and would not be inconsistent with the type of news that SCRC has PR'd in the past.
ScripsAmerica, Inc. (OTCBB: SCRC) today announced that the Company has signed a prescription sourcing agreement with United Apothecary, Inc., a pharmacy based in Oak Ridge, TN.
According to the agreement, ScripsAmerica will obtain prescriptions to be filled by United Apothecary within its areas of drug delivery licensure and receive a percentage of the revenue generated by each prescription upon its reimbursement by insurance providers.
Additionally, United Apothecary will procure raw materials necessary to fill the Company's prescriptions from ScripsAmerica's wholly owned subsidiary, PIMD International, located in Florida.
CEO of ScripsAmerica, Bob Schneiderman, stated, "We are very excited to announce this sourcing agreement with United Apothecary representing the beginning of ScripsAmerica's efforts to expand our 'specialty pharmacy' operations. The Company expects to enter sourcing agreements with several more pharmacies throughout the US allowing Scrips to effectively provide prescriptions across a growing geographic area, further increasing our revenues and shareholder value."
Here are some recent examples of the nonsense and mis-information that is continuing to be disseminated into the public space by JOSEPH ZAMPETTI and the collective of PIPE-holders who are desperately attempting to generate bid support for their .05 shares:
However a big negative may come into the picture if the co. has to prepay expenses on the 5.5million sales for Sept. If we can get a factor, as I previously recommended, to buy our triple 'A' invoices , my forecast pretty well holds .Otherwise , prepaying the expenses on $5.5million can just about wipe out the earning numbers Eventually, we will benefit from the record sales of every third month of a quarter, but while the receipts are as good as gold ,we can not count them until the money has been received.
Main Ave Revenues Profit
June 2.7M (Q2 but carried over into Q4) 1.2M=44%
July 4.1M (Q3) 1.8M= 44% ?????
August 4.9M (Q3) 2.15M=44% ?????
Doctors don't have complete control whether a patient gets an RX or not!... Insurance dictates in many cases as to reimburse or not..
Sometime a note from the Doc can help... I know this as fact from dealing with it my whole life... A person saying the docs control it and re- imbursement is no issue is wrong
I would tend to think the un-audited financials would be correct or close to it. Why would a company the size of Scrips run the risk lying only to be found out later and then face shareholder lawsuits and possible jail time?
I thought they had an auditing firm and their last Q was audited. Isn't that correct?
I have some questions about this company. Any answers will be appreciated.
1. When will this company start marketing to the street?
2. When will this company start attending and presenting at micro-cap shows?
3. When will this company start meeting with analysts?
4. When will this company implement an IR firm that markets?
5. Are there any more toxic shares that are coming down the pipe?
6. Is there a list of the names of the individuals/investors that participated in the last financing of the company for the .05 shares?
Form 144 filed AH today re: Brian Anderson, a member of SCRC's BOD:
http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10190272
A day after announcing record breaking revenue numbers, the market yawns. Why? What is it they are seeing that is keeping the buyers away? What are they not seeing?
It does not take 20-30 days to ship an order. There aren't issues with manufacturing. It's simple as it may take 2-4 weeks to get reimbursed by commercial insurance companies.
Once a prescription or order is received, the billing dept gets approval from insurance company. The prescriptions are filled by the pharmacists and then immediately sent to the patient.
Approved orders are exactly what the name suggests. Insurance companies have said they will pay for the patient's rx. It's all about waiting for the nice check to be delivered to ScripsAmerica from the commercial insurance company 2-4 weeks out.
Therefore a portion of the revenues may need to be recognized in a subsequent quarter.
With $4.9M in approved orders for AUG, this extrapolates out to a rolling-12 month revenue stream of approx $58.4M (assuming no further growth).
If the key expense metrics disclosed in the Q2 10Q also remain flat and are able to be maintained, then a rolling 12-month earnings projection (that ONLY reflects the contribution of Main Ave and EXCLUDES anything from any other revenue stream) would look like the following:
$ 58.4M......Revenues
$ (7.6M).....COGS (13% as per 10Q)
$(26.3M).....Selling Exp - Main Ave (45% per 10Q)
$ (2.4M).....Selling Exp - Other (based on $600k in Q2 per 10Q)
------------
$ 22.1M......"TAKE HOME"
$ (2.1M).....G&A (based on $522k in Q2 per 10Q)
$ (2.9M).....Share-based G&A (based upon $735k in Q2 per 10Q)
$ (0.3M).....Other Exp (based upon $67k in Q2 per 10Q)
------------
$ 16.8M......NET EARNNGS
=======
Current O/S = 135.9M
EPS based upon current O/S = .124
If O/S grows to 172M in 12 months (assuming increase of 9M/Qtr similar to 9M increase that occurred in Q2 per 10Q)
EPS based upon 172M O/S = .098
This is w/o any multiples or any premium whatsoever.
The Q2 10Q demonstrated significant enough growth in the right direction in both revenues and earnings, so this should have resulted in much more buying interest. It is very troubling to see the market resist SCRC as if it was poison ivy. And I'm not convinced that the market needs to see documented Q's reflecting profitability as the latest Q clearly showed massive improvement and a clear trajectory towards imminent profitability.
In addition, keep in mind that the sp consistently hovered between .20-.40 for SCRC's ENTIRE HISTORY up until "BS" Schneiderman engaged (and grossly overpaid) JOSEPH ZAMPETTI and the numerous other criminal Section 17(b)-violaters to orchestate the epic P&D last summer.
And every single time the sp seemingly recovered, it predictably cratered again at the exact same junctures in time when tranches of either 0.00 or 0.05 PIPE shares belonging to JOSEPH ZAMPETTI and the other CORE PIPE-holders unlocked and hit the float. I've mapped this out and posted this evidence several times previously and the historical tape is simply irrefutable.
So clearly the market previously did not require proof of profitability in order to bake in a normal amount of speculative value in a penny stock like SCRC.
It is my opinion that the market is fully aware of the weasel-talk-like PR's that SCRC issues, and is fully aware of the incestuous relationship that a CEO of a publicly traded company has apparently embraced with known criminals, and is fully aware that these criminal elements are still deeply involved with the company and are active market participants in the stock.
As such, it is my hope that by the time the annual 10K comes out next MAY/JUN that seeing these impressive revenues (and earnings) independently verified by external auditors will help, and that indicators will be present that thse criminal elements have moved on to their next con job. Seeing this will restore market confidence in SCRC again.
LOL, based on the PM's I have received today, it seems it may be useful to provide another accounting lesson for folks as it pertains to what exactly is considered revenues and what period it gets to be recognized/reported in. So, without further ado, here we go...
First, remember that SCRC experienced a backlog of approx 20 days as of the end of Q2'14, and as such, was UNABLE to recognize $1,783,018 worth of JUN's "approved orders" in the month of JUN due to the inability to manufacture and ship some of JUN's approved orders by the time 6/30/14 concluded. For those who don't remember how this was calculated, here is a Cliff Notes refresher course:
SCRC PR'd the following "approved orders" for Q2:
$958k (APR)
$1.6M (MAY)
$2.7M (JUN)
The total "approved orders" for Q2 is approx $5.3M
IF Main Ave experienced ZERO backlog and was able to ship out evey single one of JUN's approved orders, then SCRC would have recognized -- and reported in its Q2 10Q -- all of the $5.3M as revenues. However, SCRC only reported $3.5M in Main Ave revenues in its Q2 10Q. Therefore, Main Ave logically must have been UNABLE to ship (and therefore unable to recognize/report) approx $1.8M of this $5.3M of approved orders for the quarter. Specifically, we can logically narrow it down to JUN as APR's backlog would have been shipped/recognized in MAY and MAY's backlog would have been shipped/recognized in JUN, so any backlog as of end of Q2 must logically relate to JUN's approved orders.
We see that with $2.7M in approved orders for JUN that this translates to approx $90k per day. Divide this $90k/day into the total backlog of $1.8M and we come up with approx 20 days worth of approved orders being represented by the $1.8M backlog.
SO, keep in mind that the timing issue of shifting some approved orders into the following month (for recognition/reporting purposes) has NOTHING to do with when SCRC gets paid by the insurance compnay, as others are attempting to theorize. It would be a violation of US GAAP for any public company that reports on an "accrual basis" to recognize revenues on a "cash basis".
Also keep in mind that the backlog amount is irrelevant WITHIN a quarter because whatever is backlogged at end of JUL gets caught up in AUG (in essence, gets zero'd out) and whatever is backlogged at end of AUG gets caught up in SEP.
So, with this in mind, let us continue...
$ 642,000......Approved orderes PR'd in Q1
$ 617,133......Revenues recognized in Q1
------------------
$ 24,867......Therefore, this is the MAR backlog at the end of Q1 that did not get recognized in Q1 but will be recognized in Q2 in APR
So, we arrive at Q2 revenues by the following monthly entries:
$ 24,867......ADD March backlog recognized in April
$ 956,234......ADD April approved orders (per PR)
$ (638,823).....SUBTRACT April backlog (assuming 20 days, but again, is irrelevant within the quarter)
$ 638,823......ADD April backlog recognized in May
$ 1,600,000......ADD May approved orders (per PR)
$(1,032,258).....SUBTRACT May backlog (assuming 20 days)
$ 1,032,258......ADD May backlog recognized in June
$ 2,706,709......ADD June approved orders (per PR)
$(1,783,018).....SUBTRACT June backlog (proven above to be 20 days)
------------------
$ 3,506,792......Q2 REPORTED REVENUES PER 10Q
So now, let's calculate where we are in Q3 thus are using the same approach:
$ 1,783,018......ADD June backlog recognized in July
$ 4,090,000......ADD July approved orders (per PR)
$(2,638,710).....SUBTRACT July backlog (assuming still 20 days)
$ 2,638,710......ADD July backlog recognized in August
$ 4,867,637......ADD August approved orders (per PR)
$(3,140,411).....SUBTRACT August backlog (assuming still 20 days)
------------------
$ 7,600,244......ESTIMATED Q3 REVENUES RECOGNIZED THRU 8/31/14
[NOTE 1: One thing that some folks have apparently forgotten to consider is that the timing-related adjustment for the monthly backlog happens BOTH ways; you need to add in the backlogged amount from the prior month BUT you have to also remember to subtract out the estimated new backlog for the current month-end. Folks are too eager to simply add in the catch-up amount for the prior month backlog but forget to adjust out the new backlog for the current month-end]
So now, let's forecast out what the entire Q3 quarter might look like. For simplicity's sake, we will assume that SEP approved orders only grows very modestly to an even $5M:
$ 7,600,244......Estimated Q3 revenues recognized thru 8/31/14
$ 3,140,411......ADD August backlog recognized in September
$ 5,000,000......ADD September approved orders
$(3,333,333).....SUBTRACT September backlog (assuming still 20 days)
------------------
$12,407,322......ESTIMATED Q3 REVENUES RECOGNIZED FOR ENTIRE QTR THRU 9/30/14
=========
[NOTE 2: For those interested in estimating either the gross profit or the "take home" amount, which is essentially gross profit less selling expenses, remember that there is also a timing-related adjustment that needs to be made BOTH ways relatd to the commissions related to selling expenses accrued in advance for approved orders that are NOT shipped yet. In addition, don't forget to factor in COGS, which US GAAP requires to ALWAYS be recorded in-sync with revenues, so this means there will also be a timing-related adjustment necessary for this metric as well]
Hope this helps...