Purl Gurl, when a client tells an auditor that they acquired a $500 million bond for nothing, it deserves special mention in the notes to the financial statements. I posted about this earlier today:
Posted by: CHUNKY44
In reply to: Penny Stock Trader who wrote msg# 90016
Date:10/2/2006 7:12:41 PM
Post #of 90621
Penny Stock Trader, thanks for the link to the CPA Journal which helps to make my point. My problem is, the auditor does not disclose what makes up the OCI.
Looking at the list of possibilities, the OCI must be "unrealized gain on securities". So that means that cshd has a zero basis in the bond. That's right, somebody from Venezuela gave away a $500 million asset, FOR NOTHING!!! No stock, no other asset of any kind, ABSOLUTELY NOTHING!!!
Can you help me out here, Penny Stock Trader, have ever come across something like this before?
But wait, it gets even better. The auditor does include a "Going Concern" paragraph, stating that Rufus is gonna have to sell some stock or borrow some money to keep the doors open. This company claims to be making interest income in excess of $68 million per year from the bond. It's total expenses for last year were $1.3 million. WHY IN HELL WOULD RUFUS HAVE TO SELL STOCK OR BORROW MONEY TO KEEP THE DOORS OPEN?!?!
WAKE UP PEOPLE!
