Replies to post #275172 on Kraig Biocraft Laboratories Inc (KBLB)

[DimesForShares]

Mojo, the section of the 10-K is entitled “Current assets.” If KBLB didn’t consider the silk to be a part of their ‘inventory’ but it had been shipped somewhere else for processing, it would have been another kind of asset that needed to be reported on the 10-K. It’s something of value owned by the company — an asset of one sort or another. Should have been reported on the 10-K.

This could be a matter of sloppy accounting. (Wouldn’t be the first mistake KBLB made on a quarterly/annual report.) Perhaps it came in so late they decided to ignore the asset — maybe the paperwork hadn’t been finalized by the end of the year.

In that case, at some time prior to the December crop, KBLB received $304 worth of silk. A smaller crop from a previous generation, perhaps.

I don’t think we can resolve this issue. I believe the hank of silk that Thompson was holding in the December photo was worth more than $304. So I guess I’m chalking this one up to an accounting issue instead of attempting to diminish the quantity of silk he was holding and/or devalue the price per kilo.

We’ll learn more later, I hope.

[jealmc79]

It seems pretty obvious that since the inventory showed up after GSS produced some silk and then the prepaid inventory was written off after GSS was shutdown that it is associated with the silk that is or isn’t being produced by them.

KBLB is buying the spidersilk back from their contractors after it is produced and not all of it will be going to SpydaSilk. Until that silk is paid for by somebody else, SpydaSilk, Kings, or whomever, it would be considered inventory. Prepaying the contractors for that silk inventory may be needed to convince them to switch from mundane silk where they don’t get that benefit. It probably also lowers the cost of what KBLB would be expected to pay the contractors for their service. But that only works if you give the contractors something to grow, hence, the write off.