Monday, January 02, 2006
Thomas Leger & Co. auditors
Now let's take a quick look at ETLT's auditor, Thomas Leger & Co.
They audited American Oriental Bioengineering (which sounds better than the original name: Harbin Three Happiness Bioengineering) (AOB sec) which has a $219 million market cap. They had to file an amended 10-K because the original had clerical errors in Leger's auditing opinion. Of course they filed a previous ameneded 10-K due to a mistake in the weighted average number of shares calculation. And they had yet another amended 10-K before that to add another risk factor and expand Note 3. And this was after this other amended 10-K to change a bunch of stuff. There was also this amendment to the 2002 10-K to add an exhibit that was left out. One of those above was for 2003.
Weinberg & Co had taken over as auditors at this point, so it has absolutely nothing to do with Leger.
The clerical error mentioned above was that the original did not mention the Public Accounting Oversight Board, it just mentions "auditing standards generally accepted in the US".
hmmm
They audited Quantum Bit Induction (website QBIT) which is on the pink sheets, but you can see a 2002 financial statement here. Leger gave them a "going concern" qualifier, which was well deserved. They mention Note 1 (which includes management's plan), which says they've relied on funding from the company's president and common stock sales to get by, and the doubts that it has sufficient revenues to meet operating cash requirements for the upcoming year.
check
They audited Med X Systems (sec) which is/was a blank check company. Last 10-K was for 2003. In the opinion, Leger gave them a "going concern" qualifier, saying they have no assets or sources of revenue, "which raises substantial doubt about its ability to continue as a going concern."
check
They audited SKREEM Entertainment.
They also audited Fanatech back in 2001. It was an unqualified opinion. They had a healthy balance sheet and earnings. Cash flow from ops was negative due to inventories and a decrease in costs and estimates in excess of billing.
hmmm
They also audited Dolphin Knowledge. It was an unqualified opinion. The balance sheet was ok. They lost money in 2003, but had made money in 2002.
hmmm
There's also Asconi Corp.
There don't seem to be any class action lawsuits against Leger.
They audited American Oriental Bioengineering (which sounds better than the original name: Harbin Three Happiness Bioengineering) (AOB sec) which has a $219 million market cap. They had to file an amended 10-K because the original had clerical errors in Leger's auditing opinion. Of course they filed a previous ameneded 10-K due to a mistake in the weighted average number of shares calculation. And they had yet another amended 10-K before that to add another risk factor and expand Note 3. And this was after this other amended 10-K to change a bunch of stuff. There was also this amendment to the 2002 10-K to add an exhibit that was left out. One of those above was for 2003.
Weinberg & Co had taken over as auditors at this point, so it has absolutely nothing to do with Leger.
The clerical error mentioned above was that the original did not mention the Public Accounting Oversight Board, it just mentions "auditing standards generally accepted in the US".
hmmm
They audited Quantum Bit Induction (website QBIT) which is on the pink sheets, but you can see a 2002 financial statement here. Leger gave them a "going concern" qualifier, which was well deserved. They mention Note 1 (which includes management's plan), which says they've relied on funding from the company's president and common stock sales to get by, and the doubts that it has sufficient revenues to meet operating cash requirements for the upcoming year.
check
They audited Med X Systems (sec) which is/was a blank check company. Last 10-K was for 2003. In the opinion, Leger gave them a "going concern" qualifier, saying they have no assets or sources of revenue, "which raises substantial doubt about its ability to continue as a going concern."
check
They audited SKREEM Entertainment.
As discussed in Note 1 to the financial statements, the Company is in the development stage and has suffered recurring losses from operations and had a net capital deficit, which raise substantial doubt about its ability to continue as a going concern. Management plans to continue funding the operation through an affiliate owned by the sole shareholder and also plans to sell the Company. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
check
They audited Sterling Equity Holdings (SEQU sec) The latest amended 10-K has a going concern qualifier due to recurring losses and cash flow problems.
They have a current ratio worse than 1/10, a shareholder deficit, a big net loss, they do have a small positive cash flow from ops.
Leger also gave them a going concern qualifier in 2004.
check
They audited Cape Coastal Trading Corp (CCSR sec) latest 10-K
The Company is a development stage company who was focused on importing artworks and crafts from Ghana, Africa to sell to its vendors and customer in the U.S. The Company has incurred substantial operating losses from inception (August 16, 2002) to December 31, 2004. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to those matters are also described in Note 2.Note 2:
As of January 13, 2005, the Company will no longer operate the Business. Instead, the Company’s business plan will now consist of exploring potential targets for a business combinationcheck
They also audited Fanatech back in 2001. It was an unqualified opinion. They had a healthy balance sheet and earnings. Cash flow from ops was negative due to inventories and a decrease in costs and estimates in excess of billing.
hmmm
They also audited Dolphin Knowledge. It was an unqualified opinion. The balance sheet was ok. They lost money in 2003, but had made money in 2002.
hmmm
There's also Asconi Corp.
There don't seem to be any class action lawsuits against Leger.
Conclusion
I can't find anything bad about Thomas Leger & Co. They've audited several companies without anything blowing up. By their own account, they've been an accounting company for 45 years, but mostly local in Houston, TX. They have a Chinese auditor on the staff, Karen (Ruikun) Tao, // posted by Bruce @ 7:49 PM 
