John, which land did the company purchase from the government? Do you know how many acres this represents and could this land have been acquires by the Ramirez family first before being transferred to the company?
A point for consideration:
D. Property and Equipment:
Property and equipment is summarized as follows at March 31, 1998:
Sawmill - Brazil $2,395,000
Office furniture and equipment 21,585
2,416,585
Less accumulated depreciation (200,726)
Property and equipment, net $2,215,859
During the year ended March 31, 1998, an appraisal was performed on the
sawmill which provided a value that was $205,000 below historical cost.
Management has elected to write down the asset to its appraised value.
Accordingly, $205,000 was expensed to Administrative and other costs
for the year ended March 31, 1998.
E. Investment in Timber Producing Property:
The Company acquired 478,000 acres of timber producing property located
in Brazil as well as substantial acreage in Peru that are long term
concessions from Ramiro Fernandez-Moris and his family. Management has
used an appraisal to estimate the fair value of this investment. It is
reasonably possible that a change in the estimate will occur in the
near term.
On May 16, 1997 the Company entered into an agreement with various
small land owners in Brazil to purchase 251,000 acres of timber
producing property to be used for the operations of Madera
Environmental construction program. In consideration for the asset
acquired, the Company paid $441,000 through the private placement of
2,000,000 common shares valued at $200,000, and the issuance of a
$241,000 notes payable to a related party (Note G). Management has used
an appraisal to estimate the fair value of this investment. It is
reasonably possible that a change in the estimate will occur in the
near term.
We have a write down in sawmill valuation. The term, "It is reasonably possible that a change in the estimate will occur in the near term may also be considered a warning instead of a positive until more information is really known. With all the foreign transactions taking place, and their involving the Ramirez family property instead of arms length transactions, we need to be careful, as it is easy to write up valuations... |
