Spongetech Delivery Systems, Inc. (fka SPNGQ)

[harvard homeboy]

Either you believe the amount of cash a company takes to the bank from its normal, ongoing, day-to-day business activities is important or you don't.

If you think it's irrelevent, then just rely on what Spongetech tells you about how they're doing and leave it at that. On the other hand, if I didn't know how to go about reconciling a company's income statement and balance sheet changes to its cash flow statement, and have some understanding of GAAP reporting standards, I'd want to get the opinion of someone objective, who I knew and knew I could trust.

Which is why I suggest you take Spongetech's most recent form 10-Q to the CPA of your choice and ask two questions:

1. How much cash did Spongetech take to the bank from its normal, ongoing, day-to-day business activities for the 9 months ending Feb 28, 2009? and,

2. Does Spongetech's presentation of its cash flows from operations fully comply with GAAP (Generally Accepted Accounting Practices) reporting standards?

The answer to question number 1 is, like I said, a negative number and a big one; the answer to question number two is "no".

But it's important that you hear that from the CPA of your choice, not me.