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Microcap & Penny Stocks : Ames Department Stores (AMES) -- Ignore unavailable to you. Want to Upgrade?

To: WinnerSBW who wrote (1104)	4/3/1998 5:20:00 PM
From: Market Tracker	Respond to of 1911

Barry, This ones not going to be simple. This from the footnotes of the company's 3/12 press release (which also contained unaudited inc. statements and balance sheets. <<Income Taxes: For the fiscal year ended January 31, 1998 (''Fiscal 1997''), the Company recorded an income tax provision of $19.1 million, of which approximately $0.3 million will be paid in cash. For the fiscal year ended January 25, 1997 (''Fiscal 1996''), the Company recorded a non-cash income tax provision of $8.1 million. Tax benefits realized for tax purposes for cumulative temporary differences incurred prior to the consummation of the Company's plan of reorganization, as well as for pre-consummation net operating loss carryovers, are reported as additions to paid-in capital rather than as reductions in the tax provisions in the statements of operations.>> Oh Boy! - I guess it means we provided for $19.1 mil. in taxes for this just recently completed year (1/1998), however we only paid the gov't $300,000 in cash. For 1996, we recorded a $8.1 mil tax benefit from our prior tax loss carryforwards, but elected to book the entry into additions to paid in capital, rather than get a refund check. In effect, if this is the case, we took the tax benefit straight to the balance sheet, rather than flowing it through the income statement as an extraordinary item (income). I think? This is all part of the reorganization plan that was approved and agreed to by all parties (IRS included) prior to AMES' emergence from bankruptcy. The net result is, I don't think we'll be getting a refund check from IRS IMO, because the monies have already been credited to paid in capital a/c on the balance sheet. If you would like to call IR feel free. This may be the type of question where they'll have to get back to you after clarifying with management. Whew! - Gary

To: WinnerSBW who wrote (1104)	4/3/1998 7:58:00 PM
From: Arthur Tang	Read Replies (1) \| Respond to of 1911

Thank you, Barry. Last year was the first year that AMES made real money. So a lot of profits were reserved or expensed off. Don't bother to list them here. When you see Ettore,, make sure he understands public corporation has to account for any and every crumb on the floor. Paying taxes is important for stockholders' value. And paying bonus is important for the morale of the employees. If he could do them both, he should be proud to be a good manager.