New financial filing by FTTN:
On February 1, 2013, we concluded that the Company's financial statements for the year ended September 30, 2012 should no longer be relied upon and will be restated.
The financial statements as originally filed did not include the report of independent registered public accounting firm and the unaudited supplemental oil and gas disclosures. The restated financial statements will include these items. In addition, due to a typographical error, long-term liabilities including convertible notes payable and accrued interest payable had been omitted from the balance sheet as originally filed. These items are included on the restated balance sheet. The financial statements as of and for the year ended September 30, 2012 are being restated to recognize imputed interest expense on non-interest bearing advances, to recognize asset retirement obligation related to a drilled oil well and to properly show proved versus unproved oil and gas property.
The effect of the restatement on the balance sheet as of September 30, 2012, is to increase proved oil and gas property by $128,000 and to decrease unproved oil and gas property by $127,500. In addition, it will increase convertible notes payable by $20,519; accrued interest payable by $10,120; and asset retirement obligation by $500.
The effect of the restatement on the statement of operations for the year ended September 30, 2012 will be to increase both interest expense and the net loss by $20,481.
The Company expects to file restated financial statements for the year ended September 30, 2012 as soon as practicable.
The Company discussed the decision to restate the Company's financial statements for the year ended September 30, 2012 with the Company's independent registered public accounting firm, M&K CPAS
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Comment: combined proved and unproved net reserves = $253.5k....well short of the $80 million boasted in the latest press release!
