1. Summary of significant accounting policies Nature of operations, basis of financial statement presentation The Company was incorporated in the State of Nevada on March 22, 1995 as Royce Biomedical Inc. In August 2005, the Company changed its name from Royce Biomedical Inc. to Smart-tek Solutions Inc. It changed names to “TRUCEPT INC.” on January 3, 2013 to better reflect new business activities The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the following significant accounting policies:
Liquidity At December 31, 2019, the Company had cash and cash equivalents of $286, a working capital deficit of approximately $20.0 million and an accumulated deficit of approximately $8.3 million. As of December 31, 2019, the Company had disputed 3rd party liabilities of $18.9 million previously classified as delinquent payroll taxes including accrued penalties. The Company earned a net income of approximately $7,899,791 for the year ended December 31, 2019. Basis of Presentation The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Unaudited Financial Information The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in The United States of America and the rules and regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information necessary for a comprehensive presentation of financial position and results of operations. It is management's opinion, however, that all material adjustments (consisting of normal and recurring adjustments) have been made which are necessary for a fair financial statements presentation. Principles of consolidation The consolidated financial statements include the accounts of Trucept Inc. Significant inter-company transactions have been eliminated in consolidation. Use of estimates The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and related disclosures. Specific areas, among others, requiring the application of management’s estimates and judgment includes assumptions pertaining to credit worthiness of customers, interest rates, useful lives of assets, future cost trends, tax strategies, and other external market and economic conditions. Actual results could differ from estimates and assumptions made.
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