Not a lot of surprises for me, I've known about some of this at a high level.
- As I mentioned they have not diluted and they are in a lawsuit with a lender for that which I hope they are trying to work out in some amicable way outside of issuing shares, which WE ALL WOULD APPRECIATE.
- It mentions the following re: accounting issues for 2014, and that they are trying to improve for 2015. That sounds like a nice way of saying that they are trying to fix issues internally in order to do better with accounting for a small company and that is at least a partial explanation of the severe lateness in filing that we just lived through.
"Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934). Management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2014 based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. As a result of this assessment, management concluded that, as of December 31, 2014, our internal control over financial reporting were not effective. Our management identified the following material weaknesses in our internal control over financial reporting, which are indicative of many small companies with small staff: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.
We plan to take steps to enhance and improve the design of our internal control over financial reporting. During the period covered by this annual report on Form 10-K, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we hope to implement the following changes during our fiscal year ending December 31, 2015: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out in (i) and (ii) are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner. "
- There have been some loans to keep the company going for the time being from McKea Holdings, AVLP, etc. and so thats an indication that there is a belief in the companys future, along with the fact that they actually filed this 10-K instead of giving up.
What I would like to see is some sort of press release at this point. The 10-K as mentioned did tippy-toe into 2015 which is fine, and while there should be 3 10-Qs in the queue that hopefully will be issued within weeks, I don't want to wait that long for a warm and fuzzy PR or at least some meaty FB posts and some more effort there.
