Forecross Corporation Restates Earnings
SAN FRANCISCO--(BUSINESS WIRE)--July 17, 1998--Forecross Corporation (VSE:FRX.U), a leading legacy migration and year 2000 solution company, announced today that it is restating earnings for certain prior periods in response to comments from the Securities and Exchange Commission (the "SEC"), in order to recognize certain revenues ratably over the entire term of certain contracts rather than when the Company expects that contract work would be substantially performed.
The restatement relates to the Company's policy on revenue recognition for certain year 2000-related software licenses and distributor agreements. Under the Company's previous accounting policy, the Company recognized revenue under these agreements ratably from execution of the contracts until December 31, 1999, the period during which the Company anticipated that it would perform substantially all services required under the agreements.
On April 15, 1998, the Company filed a registration statement on Form 10 with the SEC which became effective on June 15, 1998. Although the Company and its independent auditors believe that the previous policy was in conformity with generally accepted accounting principles, the Company has agreed to comply with a request made by the SEC to recognize revenues ratably over the entire term of the contracts in question without regard to consideration of the date by which the work resulting from such contracts would be substantially completed. The net effect of the restatement was to reduce revenues and increase net loss for the six months ended March 31, 1998, and the fiscal year ended September 30, 1997, by $240,093 and $193,748, and to increase net loss per share by $0.02 and $0.02, respectively.
The restated periods are: June 30, 1997, quarter and year-to-date; September 30, 1997, quarter and fiscal year; December 31, 1997, quarter; and, March 31, 1998, quarter and year-to-date. Revenues, income/(loss) from operations, net income/(loss), and net income/(loss) per share have been restated to reflect the change discussed above. The revised results of operations are: -0- *T
3 Months Ended 3/31/98 6 Months Ended 3/31/98
As Originally As As Originally As
Reported Restated Reported Restated
MARCH 31, 1998
Revenues $2,121,228 $2,001,181 $3,625,512 $3,385,419 Loss from Operations (287,311) (407,358) (1,000,288) (1,240,381) Net Loss (360,751) (480,798) (1,099,865) (1,339,958) Net Loss Per Share (0.03) (0.04) (0.09) (0.11) Weighted Average Number of Shares Outstanding 11,763,612 11,763,612 11,760,469 11,760,469
3 Months Ended 12/31/97
As Originally As
Reported Restated
DECEMBER 31, 1997
Revenues $1,504,284 $1,384,238 Loss from Operations (712,977) (833,023) Net Loss (739,114) (859,160) Net Loss Per Share (0.06) (0.07) Weighted Average Number of Shares Outstanding 11,758,112 11,758,112
3 Months Ended 9/30/97 Year Ended 9/30/97
As Originally As As Originally As
Reported Restated Reported Restated
SEPTEMBER 30, 1997
Revenues $1,488,489 $1,368,442 $5,968,786 $5,775,038 Loss from Operations (785,788) (905,835) (782,108) (975,856) Net Loss (791,794) (911,841) (851,763) (1,045,511) Net Loss Per Share (0.07) (0.08) (0.07) (0.09) Weighted Average Number of Shares Outstanding 11,750,862 11,750,862 11,681,035 11,681,035
3 Months Ended 6/30/97 9 Months Ended 6/30/97
As Originally As As Originally As
Reported Restated Reported Restated
JUNE 30, 1997
Revenues $2,346,738 $2,273,037 $4,480,297 $4,406,596 Income (Loss) from Operations 149,651 75,950 3,680 (70,021) Net Income (Loss) 154,762 81,061 (59,969) (133,670) Net Income (Loss) Per Share 0.01 0.01 (0.01) (0.01) Weighted Average Number of Shares Outstanding 12,509,343 12,509,343 11,660,638 11,660,638
*T About Forecross
Founded in 1982 as a high-technology software development laboratory, Forecross Corporation is dedicated to the design and development of innovative conversion software. Clients have included such leading corporations as Aetna Life Insurance Company, Brown Brothers Harriman & Company, Charles Schwab & Co., BDM Technologies, Inc., IBM Corporation and Bank of America NTSA for its migration software services. AASKI Technologies, Ltd., TRW, Inc. (BDM International), CIBER, Inc., Information Sciences Group, Inc., NCR Corporation, SCB Computer Technology, Inc. are among the teaming partners of Forecross Corporation for its Complete/2000(R) offerings.
NOTE TO EDITORS: The Vancouver Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this News Release, which has been prepared by the Company.
Forecross is a registered trademark of the Forecross Corporation. Complete/2000 is a U.S. registered service mark of Forecross Corporation.
CONTACT:
Forecross Corporation
Patricia A. Jones, 415/543-1515
Patricia-Jones@forecross.com
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