Baristas Coffee Company, Inc. (BCCI)

[BobSinCA]

Scam or not scam -- all in the definition.

Fact of the matter is that the business model is not profitable.

As payperview has pointed out, the company has given out tens of millions of shares for services rendered, and put them on the expense (and stockholder equity) accounts at par value (.001/share). Someone has finally told them this isn't appropriate, so in Q2 they were changed into $8M worth of 'unidentified tangible and intangible assets.' $8M represents the market value of the shares when issued.

Making lemonade of lemons, BCCI noted that this change increased company equity!

As a former auditor, I will tell you that assets which can not be identified, are not assets, and will be written off IMO -- thus wiping out all reported BCCI coffee profits and then some.

Although, BCCI is trying to rewrite history; their Q2 2012 financial statements, for example, showed 5M shares valued at $5K issued for 'ice cream distribution funding'; suddenly, the Q2 2013 statements show these shares, now correctly valued at $500K, as an 'asset purchase.' That is one HECK of a lot of ice cream; hard to believe that much was bought in Q2 2012 -- if sold, you would think we would have heard a lot about it!! And if not sold, after 18 months would it still be good??

And this is before the most recent dilution to buy $1.7M of advertising, likely with 40M or so shares (combination of preferred and common). Advertising is also an expense, and must be written off, IMO. As I previously noted, unless BCCI makes a 'subsequent events' disclosure in its Q3 financial statements -- which it should, as $1.7M is quite material (a years worth of sales!!!) -- we won't see the accounting for this program until 2013 financial statements are published sometime in the spring.

Audited, perhaps??

In terms of future value, BCCI has has had difficulty attracting investors required to finance new stores, which is why it did not achieve its heavily promoted goal of 100 store openings in 2011. Perhaps Cape Coral will have a positive result that can be a model for other investors -- but at what cost in terms of all the stated advertising? How does that amount of advertising compare to anticipated Cape Coral annual sales, wonder if we will be told?