Replies to post #171622 on DD Support Board and Research Team

[integral]

Welp, I had to wait for dear spouse to a free moment to answer a hypo to a question I already knew the answer to. It is a soft hit on the financials, but it still affects valuation. Also, the deriv. owner has a tax liability in the year it was issued based on the discounted rate, and then capital gains once sold. The holder wants out as soon as possible with a discounted conversion, so that will eventually suppress the stock price. The deriv. liabilities do have repercussions even though it is a soft hit. Not many CPAs are efficient in deriv. accounting no matter how many years of college and CPE classes, even dear spouse had to think about this one.

Auditors are much more proficient at deriv. accounting than oil patch or tax accountants in strip malls.

[nodummy]

Check what I said - read both statements:

Besides the low amount of inventory, financial statements show that PCTL has struggled with expenses. It cost PCTL $1,956,000 to sell $534,000 in products through the first 9 months of 2019 (so they weren't making money). All total the company lost over $10,000,000 through the first 9 months of 2019 alone - not exactly a feasible business let alone one that can manage the added expenses of an increase in business operations.

Statement #1: It cost PCTL $1,956,000 to sell $534,000 in products through the first 9 months of 2019 (so they weren't making money)

Statement #2: All total the company lost over $10,000,000 through the first 9 months of 2019 alone


Statement #1 refers to the how bad the business operations are

Statement #2 refers to the poorly the company is run



Derivative liability or not, PCTL is a money losing venture that is struggling with expenses and isn't capable of managing the added expenses of an increase in business operations.