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Re: 10Q QuestionsMysterious Chinese affiliate, we barely knew you. 'Twas the "equity income of affiliate" that got my attention. 64 whoppin' thousand dollars - I feared that we might be seeing the emergence of Me, Inc. in SCOX financials. But no... "We account for our ownership interests in companies in which we own at least 20% and less than 50% using the equity method of accounting. Under the equity method, we record our portion of the entities’ net income or net loss in our consolidated statements of operations. As of April 30, 2007, the carrying value of our investment of $495,000 was for our 30% ownership in a Chinese company. During the three months ended April 30, 2007 and 2006, we recorded $64,000 and $0, respectively, representing our portion of the net income (loss) in this entity. During the six months ended April 30, 2007 and 2006, we recorded $106,000 and $(8,000), respectively, representing our portion of the net income (loss) in this entity." I don't recall any 8-Ks spelling out their purchase of an equity stake in any Chinese companies. I *do* recall the stray SCOX backer appearing on the Y! boards pronouncing that they're making inroads in China. Could it be that they managed to sell $495K worth of OpenServer licenses to a Chinese company in exchange for an identical investment in the equity of said hypothetical enterprise? The mind boggles - the Chinese economy is the Wild West of entrepreneurship in the world today, with little 'cottage' industrial concerns experiencing explosive growth, making the odd, stray little worthless things that our beloved 'stuff' comes chock full of. To think that SCOX could be starting to see ROE on bra strap adjustment rings, oral contraceptive packaging, automotive valve caps, eyes for plush toys or maybe even twist ties - well, it tickles me in all the right places. Darl, *please*, tell us more about this Chinese company and about how you became invested in it... http://www.sec.gov/Archives/edgar/data/1102542/000095013407013419/v31153e10vq.htm |
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Msg # | Subject | Author | Recs | Date Posted |
33418 | Re: 10Q Questions | _Arthur | 4 | 6/15/2007 12:25:16 AM |