Spongetech Delivery Systems Inc (fka SPNGQ)

[harvard homeboy]

Hey no BS plz,

So you TEACH an investment class at a local college?

Very cool. So tell us then, in your professional opinion, how much CASH did Spongetech take to the bank from its normal, ongoing, day-to-day business activities for the nine months ending Feb 28 2009?

The number I'm coming up with is ($9.9 million). You? And by all means, please feel free to break it down for me in simple steps, just like the remedial community college students you teach. I'd love to see how you do the math on this one. Really.

And by the way, if you click back through the message to which you responded, and take a look at the one to which I was responding, this is the sentence that attracted my attention: << D&L, E&Y, KPMG, or PWC do not take on clients because they can afford it. They take them on because they believe the company has a viable market share in their line of busines, and because they believe the company is already following GAAP standards. >>

Now that statement, as I'm sure you know, is particularly foolish. The major accounting firms are not in the business of making subjective assessments of inchoate stuff like "viable market share in their line of business" and publicly held companies are required to follow GAAP standards in any case.

Of all the companies that have imploded or have been outright frauds in the last 25 years, can you name one that was uncovered by the outside auditors? There might actually be one or two out there, though if so, I certainly can't think of it offhand. However, all of the other companies I cited, and lots of others, have failed despite having clean opinion letters from the outside auditors with major accounting firms attesting to GAAP-compliant financial statements.

And by the way, you're also wrong about the notion that it was short sellers who drove Bear Stearns and Lehman Brothers into receivership. It was the counterparties to the Bear Stearns and Lehman Brothers fixed income desks who bolted and insisted on additional collateral. That's what caused those shops to fold, unless you got it right and the Wall Street Journal got it wrong, that is.

I didn't mean to distract you from your lesson plan for the community college students you're "teaching" in Remedial Business Education 101, but just wanted to inject a baby dose of reality into the discussion.