Bemax Inc (BMXC)

[I-Glow]

That is complete nonsense - obviously there is a lack of understanding of basic accounting - a purchase order is reported each time a order is placed.

Read the Income Recognition in the financials.

"Revenue Recognition

We follow ASC 605-10-S99-1, Revenue Recognition , for revenue recognition. We will recognize revenue when it is realized or realizable and earned. We consider revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists; (ii) the product has been shipped or the services have been rendered to the customer; (iii) the sales price is fixed or determinable; and (iv) collectability is reasonably assured.

Pre-payment Policy: All sales to our customers will be solely on a pre-payment basis. Once the order is completed and payment is received, we will place an order with the North American supplier of disposable baby diapers and arrange shipping directly to our customers. The process is expected to take three weeks to complete. The pre-payment will be recorded as deferred revenue until the delivery is executed."

As you can see - the revenue is recognized as Deferred Revenue until Delivery - and all sales are pre-paid.

If you look at the Annual Financials - there isn't any Deferred Revenue reported.

I don't know of any GAAP compliant accounting where the revenue is recognized until the purchase order is completed - that would screw up the COGS - the SGA...

IG