I did not give a list of "questions", I gave a list of topics I would like FH to address... I think SHs should listen first to everything FH wants to say before they ask questions... and when they do ask them, they should try to elicit some information that will help gain a better understanding of the merits of the investment...better to ask him to speak on a topic that is open ended and not antagonistic or accusatory....questions that are phrased like your question, that accuse him of making a mockery of something, will not get information... and will just be disruptive... which I assume is your usual agenda... you must ease FH into subjects, not try to jam him... is is not going to respond to questions that are phrased to attack him...
Fotoz formula for getting information from FH... ask him a question you know he wont or cant answer, tell him that he is being bad, congradulate yourself and tell everyone that you punked FH... but, punk yourself in the process because you get no information...
I think he probably will have a fixed agenda of information he is willing to give out and a set of questions he will not be willing to answer... there is no answer to your question when you start off with the view that the PRs should be based on GAAP....they obviously were not... the PRs and the financials are inconsistent to some extent and we already have figured out why... the PRs were not based on GAAP, and they leave off certain expenses... maybe you could ask him what accounting system was used when the statements about sales and profits were made in the PRs... I dont know if he would answer that one...
He is not going to say he lied about profits or sales in the earlier PRs... Any answer he gives will not satisfy and will be vague and uncertain... for example, that the accounting used for the PRs was "marginal cost accounting", rather than GAAP accounting, and that probably is the real answer because a lot of small business use marginal accounting in making decisions and watching progress... and so, IMO, part of the answer is that he did not include all the costs that GAAP requires when he made some of the earlier statements... such as, he did not charge good will against "profits" when he claimed he was making profits, and this indeed is an esoteric point about what expenses must be charged, etc... maybe he pumped in the PRs for a sinister purpose, but he is not going to admit that or say anything to show that...
You might try to ask about the recent financials and see if he will give an update for the 6/30 quarter... and how the 9/30 quarter is doing so far... but, until they get audited by an accountant who opines they are accurate and in accordance with GAAP, they do not guarantee much...
My suggestion if you go to the meeting, keep in mind that you have no power and you are not in control... the best thing a shareholder can do is listen... dont ask questions in an antagonistic or attacking manner... you can get more with honey...He is not going to let you take his deposition, so it is pointless to even try... IMO In case your wondering, I wont be at the SHs meeting...
AI
