Veltex Corporation (PINKSHEETS: VLXC) (OTC Pink: VLXC) Veltex Corporation ("Veltex") announced today that accounting practices for the corporation will shift to a cash basis taxpayer reporting platform under generally accepted accounting principles.
Veltex's outside accounting firm, Sassetti & Company, LLC ("Sassetti") has advised Veltex to convert the accounting format from a tax compilation method to GAAP. Under the tax compilation method, in which Veltex had been implementing, a taxable event would occur wherein the corporation would have been required, under current Internal Revenue Service ("IRS") rules, to carry certain unpaid interest on the judgments, noted below, as taxable events. Although the judgments held by the corporation for the benefit of shareholders will not be reflected in the current asset side of the balance sheet, those judgments, and the interest due thereunder, remain in full force and effect and will be carried in the accounting footnotes. The corporation has not written down those judgments. In fact, a program to implement enforcement and collection of each is underway. Veltex has also retained the services of a major collection firm in California for collecting the judgments in those jurisdictions of Los Angeles County and Orange County of certain of the defendants. An investigation of other judgments in locations such as Clark County Nevada and those in Canada continues.
GAAP or generally accepted accounting principles, is a collection of commonly followed accounting rules and standards for financial reporting. GAAP specifications include definitions of concepts and principles, as well as industry-specific rules. The purpose of GAAP is to ensure that financial reporting is transparent and consistent from one organization to another. There is no universal GAAP standard and the specifics vary from one geographic location or industry to another. In the United States, the Securities and Exchange Commission (SEC) mandates that financial reports adhere to GAAP requirements. The Financial Accounting Standards Board (FASB) stipulates GAAP overall and the Governmental Accounting Standards Board ("GASB") stipulates GAAP for state and local government. Veltex has begun the review of possible further required changes to the International Financial Reporting Standards ("IFRS"). The SEC has released a proposed roadmap for conversion from GAAP to IFRS.
A United States District Court in California in 2012 handed down one of the largest awards ever in the Central District of California, more than $102 million, in favor of Veltex Corporation. The judgment continues to carry interest. That interest, which is accumulating on the financial record for Veltex, currently amounts to more than $2,250,000. Several defendants have settled with Veltex under strict confidentiality agreements. That case was filed in the United States District Court, Central District of California (Western Division - Los Angeles) entitled, Veltex Corporation vs. Javeed Azziz Matin et al, case number 2:10-cv-01746-ABC-PJW. The case alleged damages from 22 individual and corporate defendants. The litigation, which had been followed closely by legal scholars, outlined a massive fraudulent conveyance and transfer count wherein the defendants stole millions of dollars of corporate assets. These judgments, which are joint and severable, carry interest which is accumulating on an annual basis, as noted above.
Veltex will update shareholders with developments as progress warrants on legal, tax and accounting matters. Veltex Corporation seeks to update new and potential shareholders on the immediate future of the company as developments warrant. It is in the process of updating financial reports, statements and business plans to be fully transparent and compliant through OTC Disclosure. Shareholders will always be included on all company updates. We look forward to creating partnerships and alliances that will highlight our comparative and competitive advantages in the holding industry and in general.
Veltex Corporation, incorporated in the State of Utah September 17, 1987, is a public holding corporation, which maintains its corporate headquarters in Chicago, Illinois. The company's common shares trade OTC Markets under the symbol VLXC.
Safe Harbor Statement
Forward Looking Statement
Safe Harbor Statement Certain of the above statements contained in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. This press release includes forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by phrases such as Veltex or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar import. Similarly, statements herein that describe Veltex's business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements. Any statements made in this press release which are not historical facts contain certain forward-looking statements; as such term is defined in the Private Security Litigation Reform Act of 1995, concerning potential developments affecting the business, prospects, financial condition and other aspects of the company to which this release pertains. The actual results of the specific items described in this release, and the company's operations generally, may differ materially from what is projected in such forward-looking statements. Although such statements are based upon the best judgments of management of the company, Veltex, as of the date of this release, significant deviations in magnitude, timing and other factors may result from business risks and uncertainties including, without limitation, the company's dependence on third parties, general market and economic conditions, technical factors, the availability of outside capital, receipt of revenues and other factors, many of which are beyond the control of the company. The company disclaims any obligation to update information contained in any forward-looking statement. This press release shall not be deemed a general solicitation.
Investor and Company Contact:
Stephen G. Macklem
SOURCE: Veltex Corp