Replies to post #30190 on CirTran Corporation (CIRX)

[Pure_Greatness]

I said that but MF didn't stop asking about the royalties. Pls go on I love this.

[MFlores]

Paying royalties and recording the expense / liability are related, but not the same thing. If I read basic accounting rules right, the expenses need to be accrued / incurred if the agreement is in place and revenue is recorded. That is entirely different from the payments for the royalties. A business records the expense / liability first. Then the liability is paid. Separate matters.

The question still stands - where are the royalties being recorded? Maybe the Company is not recording the expense because they do not have the make the payments right now. If so, that will be a big problem.

[MFlores]

paid vs accrual is totally different. I already explained that to you but you simply do not get it. Even though they do not have to pay YET, GAAP accounting says that CIRC needs to record the expense on their books and show a liability, especially if they are still "using" the trademark. Basic GAAP accounting. Do not see it anywhere. So the results are inflated. Recording revenue from sales using the royalty but not recording the expense for using the royalty. Totally different than paying cash. Cash vs accrual accounting. Very basic accounting.