With so many different entities that have to be examined, unaudited financial statements can take quite some time to compile. Although these financials are the representation of management, still, the accountants require that everything be documented. For example, they have to check out previous years' tax returns to make sure they correspond to transactions that are on the books. I would also expect there to have been many intercompany transactions that had to be sorted out by the accounting team. All of this takes plenty of time. How much time also depends on the number of staff accountants assigned to the case.
Another thing is that the financial report must include a description of contigencies, that is, whatever lawsuits the Company is involved in, the outcome of which might affect its financial position. I would think that each case had to be separately analyzed to determine whether it is the Company that is at risk or only its officers who are individually named in a lawsuit.
What we don't want to see is a "going concern" statement from the accountant expressing any doubt that the Company might not be able to continue its operations due to undercapitalization or for whatever other reason. From what has been posted thus far by Bayport, it would appear that the likelihood of such an opinion is virtually nil.
What I would like to see is a positive number in retained earnings rather than a deficit, which would reflect multi-year profitability.
I understand Bayport has plans to move to a higher exchange after some time, where yearly audited financials will be required. I therefore believe the financial statements that are being prepared currently are being done scrutinizingly in anticipation of those future requirements. If the accounting firm lays the groundwork now in preparation for audited financials, the work will be much less time consuming the next time around.
