Plastic2Oil Inc (PTOI)

[Artiztic1]

It's much more than a restatemnet issue, EQUITY ISSUANCES as well, and this is just the start of the investigation.

Based on communications with the Enforcement staff, the Company believes that the proposed lawsuit relates to the Company’s subsequently restated financial statements for the third quarter of 2009, which were included in its Form 10-Q filed on November 16, 2009 and its financial statements for the year ended December 31, 2009, which were included in its 2009 Form 10-K filed on March 31, 2010. The restatement concerned the Company’s valuation of media credits, accounting for certain acquisitions, and equity issuances.

http://www.sec.gov/Archives/edgar/data/1381105/000121390011003788/f8k071411_jbi.htm


NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RESTATEMENT

Restatement

The Company has RESTATED its previously issued consolidated financial statements for the period ending September 30, 2009 for matters related to the following previously reported items: (1) the original accounting for the acquisitions of Javaco and Pak-It, which was improperly recorded as a reverse merger, whereby pre-acquisition operations of the acquired entities were erroneously reflected in the operations as originally reported, and (2) the valuation and subsequent impairment of media credits. The accompanying financial statements for the quarter ending September 30, 2009 have been RESTATED to reflect the corrections. The effect of this RESTATEMENT to the financial statements is a decrease in total assets of approximately $13,187,000, an increase in net loss for the nine months ended September 30, 2009, of approximately $1,110,000 and a decrease in equity of $10,343,000.

The following is a summary of the restatements for the nine months ended September 30, 2009:

Write off of previously recorded media credits $ (1,000,000)

Decrease in income due to change in acquisition accounting for Pak-It (1,616,600)

Decrease in income due to change in acquisition accounting for Javaco (596,213)

Decrease in income due to change in acquisition accounting for John Bordynuik, Inc. (126,569)

Decrease in operating expenses due to change in acquisition accounting 1,256,983

Increase in net interest expense due to change in acquisition accounting (141,468)

Increase in other income due to change in acquisition accounting 45,110

Increase in net income from reclassifications and timing corrections 1,068,323

Total reduction in September 30, 2009 net earnings $ (1,110,434)

Decrease in the valuation of media credits $ (9,997,134)

Decrease in the value of assets acquired from John Bordynuik, Inc. (572,102)

Decrease in the value of goodwill and other assets recorded in conjunction with the acquisition of Javaco and Pak-It (2,360,990)

Decrease in assets from other adjustments (256,432)

Total reduction in September 30, 2009 total assets $(13,186,657)

http://www.sec.gov/Archives/edgar/data/1381105/000121390010004885/f10q0909a1_jbi.htm