Yogen Fruz IT'S ALIVE, IT'S ALIVE Message Board

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Gold/Mining/Energy : Yogen Fruz IT'S ALIVE, IT'S ALIVE

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To: Marc Fortier who wrote (951)	1/10/1999 10:18:00 AM
From: telecomguy	Read Replies (3) of 2453

Regards to the accounting issue -- we are not talking about Bre-X, Livent, or YBM Magnex!! They recognized revenue on a franchise sale at the time of contract close on an accrual basis before the year end two years ago. ALL companies do some sort of revenue accruals to try to match direct costs with recognizable revenue. The accounting principles simply state that there has to be material evidence that the revenue recognized is supported by contracts and is collectable in the not too distant future. So, YF simply recognized these revenues into 1995 (and I believe they 've collected most of those licensing/franchising fees in 1996). If in the event that YF franchisee reneges on the contract, then the revenue will be reversed in 1996 and the profits of course are also reversed. This is BASIC ACCOUNTING. There was no attempt to deceive, defraud, or manipulate the financial statements to dupe the public. I mean the amount in question is not even that huge (5 million I believe) and besides I am not sure to what purpose the Serruya brothers would be trying to manipulate the stock price since they've not sold their shares and are committed to YF. This is an absolute non-event and was triggered by some day-trader in New York who was probably shorting the stock. When challenged by YF mgmt and YF's accounting firm (Price Waterhouse I believe) to discuss the issue in open public forum, the guy in NY that started this whole shenenigan never responded (he made his profit!) The butterfat price & the Far East/South American problems had LOT more to do with the YF price plunging (to me it was total over-reaction). Unfortunately, YF has not participated in the rally - partly because of their Small Cap nature - as the Butterfat price & the international markets started to regain their normalcy... Good earnings will change all that and the institutions will jump back - as always - after the fact.

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