Form 8-K/A for TREATY ENERGY CORP
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31-Mar-2011
Non-Reliance on Previous Financials, Audits or Interim Review
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
On March 30, 2011, the Board of Directors ("Board") of Treaty Energy Corporation ("Treaty" or the "Company") concluded that the Company's financial statements contained in its quarterly reports for the period ended June 30, 2010 and September 30, 2010 should no longer be relied upon.
In the previous reports, the Company had recorded its basis in its Belize joint venture with Princess Petroleum Limited as $100,000, which was recorded as having been paid by a principal shareholder. However, the Company has discovered that the principal shareholder sold 20,000,000 shares of his Treaty stock to the principals of Princess Petroleum, but that in connection with this transaction, the Company agreed to repay the principals of Princess Petroleum $100,000. The Company has also discovered that there is an additional promissory note for $100,000 entered into on the same date with principals of Princess Petroleum. As a result, the Company has concluded that it should adjust its basis in the Belize property to $200,000 to account for the additional promissory note.
The Company has discussed these matters with its auditors and is working to correct the above item in its annual report for the year ended December 31, 2010.
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