The company collectively has failed in this regard and your question is really much broader than you may know. I also believe that you in part already know the answer to this question and are baiting me to see what I will say, but I will give you the benefit of the doubt in this regard and assume that your intentions are noble.
It would not be fair for me simply to say "Dave Williams had the documents so he was in charge of getting the financials together" or "Ed Walsh is an accountant and had the opportunity to get involved so he should have been doing them" or "Kyle was the Interim CFO and ultimately, as soon as she accepted the position, she was in charge of getting the financials in order" or "Cristian was the CEO and if he was aware of the problems with getting the financials in order and did nothing to correct it, so ultimately he is responsible".
You see - ALL of these statements are half-truths because when made out of the context of what was going on - they do not provide the full picture and provide opportunity for someone to simply blame someone else without ever addressing the underlying problem. I will first attempt to give you the full picture as I understand it from publicly available information and then I will share my opinion.
- Both Kyle and Dave testified on stand at the trial on Feb 1st that this company has never been good at keeping financial records. Whether it is taxes, income and expenditure tracking, SEC compliance and reporting issues, shareholder communication, shareholders of record, bills, lease expenses, debt. There simply is not a good accounting of ANYTHING. Kyle, Dave and Ed all walked into this a few years back and I doubt any of them had any idea how difficult it would be to make sense of where all the bodies were buried. Shortly after coming on board, Dave, Ed and Kyle all worked together on solving some of these issues and were all aware of how difficult it was.
- Dave, Ed and Kyle all have full-time occupations outside of Calypso and other obligations that do not allow them to devote themselves fully to the company.
- When Dave came on board and secured the company records, his testimony in court was that they arrived at his office in complete chaos. The shipping company just shoved files into boxes and "shuffled them like a deck of cards" as Dave testified. Dave attempted to work on the records but it is difficult to know where to start when you are staring at dozens of boxes and file cabinets and roughly 150,000 documents.
- Dave testified that he attempted to hire his book keeper to sort through the records but the company was either not willing or more likely, unable to pay for it.
- When Kyle was appointed interim CFO, she requested that Dave provide her with the records as she testified. This is a reasonable request no doubt. Dave at this point was concerned about some of the stuff he had found in the records and his attempts to confront the board collectively about it usually ended in conflict. Dave testified to this in court.
- Under mounting tension, the working relationship broke down between Dave and Kyle and at this point "Angry Dave" enters the equation. Dave makes matters a whole lot worse by mishandling his communication with just about everyone due to his anger and frustration with the entire situation.
- Continued lack of funding makes matters worse and worse. Dave grew resentful of always kicking in funds at the 11th hour and refused to turn over the documents without having them copied first out of concern that they would be destroyed or manipulated. Whether founded or not, the company refused to help him pay for this cost and took a hard line. Dave responded in kind and took a hard line to releasing them without the assurance that they would be taken care of.
- Public pressure from shareholders, now the SEC, the IRS and creditors along with a stale T-mobile lawsuit, pressure with the Daic lawsuit, still no funds and mounting outrage result in continued deterioration.
- I enter the picture and assist the company with redoing the company website. When I became aware of the copying issue, I offered to contribute the required funds to the company in exchange for shares in the public offering as long as they'd be earmarked for the copying effort. After this offer was denied by management, I then offered to pay for the copying effort entirely myself - out of my pocket in exchange for NOTHING just to see it resolved. I also offered to fly out and arrange for the secure transport of the documents. Both of these offers were also turned down and I was told to stay out of it. Then we had the shareholders' forum and the company collectively cited the fact that Dave had the records as one of the primary reasons we weren't moving forward - knowing full well I was sitting in the room and had offered to handle the situation. Shareholders responded and insisted that they be allowed to contribute to resolve the situation to which Kyle agreed (after turning me down several weeks prior). I arranged the copying effort and got the whole thing taken care of in a few weeks.
- Now after the records were copied and both Dave and Kyle had digital copies there should have been no excuses from anyone right? Well the reality is that in court we found out that the records Dave had in his possession did not contain all of the information needed to produce financials (audited or otherwise).
So you ask who was in charge of getting the financials in order before Pierce came on board? Who had the most knowledge of the companies situation, with the authority to act and create an environment of compromise? Who's ultimate responsibility is to to make sure the company is in compliance with SEC, the IRS and general accounting principles, laws and guidelines? Who's job was it to raise funds to keep the doors open so directors weren't arguing over $7,000 to electronically archive the company's largest body of documents? Who's job was it to make sure there was a transition of both electronic and paper accounting records from one regime to another and if there was a problem to make it known and fix it?
My answer - the CEO, President and Chairman of the Board.
Now it is true that the Cristian was not being paid and I am sure this killed his motivation. It is also true that Cristian was going through a lot of personal issues at the time and was in and out of the country. In his defense he had a lot on his plate, a lot of pressure, a lot of conflict. He may not have been aware of all of the problems or the legal requirements. But it was his job to bring in the funds to make sure that we could meet our obligations and move forward and when you are in a position of authority, it is your job to either make it happen or step down and pass the reigns to someone else if you cannot. I ultimately hold the CEO responsible for the deterioration of this company. He failed to cast a vision and unite his team and shareholders have to pick up the pieces. But even with that said, this failure was a team effort.
