Verus International Inc (VRUS)

[GermanCol]

I don't understand why there would be incomplete paragraphs from the 8-K, adjusting them out of context....That's Fake News.

As quoted below, the auditor thinks the company has to restate previous financial statements for:

a. Unrecorded stock-based compensation, and
b. Classification of equity instruments (including conversion features, warrants, and stock compensation warrants) subsequent to the Company having an insufficient number of authorized shares to settle certain equity classified instruments.

That doesn't mean that the company has unrecorded stock-based compensation or that the company has insufficient number of authorized shares in this moment.


The company doesn't agree with restating previous financial statements and it is a very smart decision, because it would take months to restate them and we are after the due date for the 10K. Another smart decision by the company is having the audit done by the previous auditing firm. They already audited previous years, know VRUS, know the standards they used for previous audits and worked hand on hand with the other audit firm, so it will take much less to have the audit ready, even if it wouldn't have been these differences with the other firm. I have been a Financial Manager for many years and I know accounting policies are not black and white and know how hard is to change an auditor. If the company wants to change it some time or restate whatever from previous periods, it will have plenty of time after filing the 10K, since the audit is done once in a year, but now is not the moment, company's priority #1 in this moment at this moment is filing the 10K.

As proved below with the whole 8K, not adjusted pieces, unrecorded stock-based compensation and company insufficient number of authorized shares relates to previous reporting periods when the company had the authorized shares maxed and this was fixed last year with the increase in AS when Angel Investor Andrew Garnock invested and paid all toxic notes. So that problem doesn't exist anymore. I have been a shareholder for around 3 years and know very well about this and know about the transparent management team we have here.


Whole text of the related paragraphs on 8K:

From the Engagement Date through the Effective Date, except as discussed in the following paragraph, there were no disagreements between the Company and MHM on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of MHM, would have caused MHM to make reference to the subject matter of the disagreement in connection with any report MHM would have provided to the Company. Furthermore from the Engagement Date through the Effective Date, there were no reportable events[/color] (as described under Item 304(a)(1) (v)(A)-(D) of Regulation S-K) for the Company.

The Company and MHM had certain unresolved discussions on whether, and how, to correct prior period financial statements for the following errors:

a. Unrecorded stock-based compensation, and
b. Classification of equity instruments (including conversion features, warrants, and stock compensation warrants) subsequent to the Company having an insufficient number of authorized shares to settle certain equity classified instruments.

Although MHM did not complete its audit prior to the Effective Date, MHM believes the errors are material to the prior period financial statements, including the annual and interim periods affected, and therefore, should be corrected by restating the financial statements previously filed (e.g., via a Form 10-K/A and Form 10Q/A). Additionally, the Company and MHM had certain unresolved discussions on the sufficiency of documentation necessary to support amounts recorded in the current period financial statements.

Link to the filing:

https://www.otcmarkets.com/filing/conv_pdf?id=13945564&guid=jh8CUqE6edbcl3h