Decision Diagnostics Corp (DECN)

[loanranger]

"You and the other ID, need to look at accounting books a little."

I really don't need any help with this.
The proper expense recognition procedure for obsolete inventory is to determine the most likely disposition value for the targeted items, subtract this value from the book value of the obsolete inventory, and set aside the difference as a reserve. As the obsolete inventory is actually disposed of or estimates in the disposition values change, adjust the reserve account to reflect these alterations.

It's the preparer of the DECN financials (CEO Berman at last report) who needs to read a book or two. This should never have happened:

"Changeover to the FDA UDI product packaging format has necessitated a withdrawal of non-UDI inventory from stock, valued at $0 due to its obsolescence. This process began in the period ended June 30, 2016 and September 30, 2016 and are reflected herein. The company expects to sell this obsolete but suitable product in International markets."

A company that expects SOME recovery on a sale of obsolete inventory and hence acknowledges that it has some value should not be reserving it's total value and valuing it at $0. If Berman REALLY expects to sell the stuff he should be recording it at the expected recovery value.
Either he's performing his usually flawed accounting or he doesn't really expect to have a recovery and he has accounted for the obsolescence properly. Having it both ways may make everybody feel better but it isn't proper procedure.