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Microcap & Penny Stocks : PINC - Planet City -- Software and Services -- Ignore unavailable to you. Want to Upgrade?

To: TENNET who wrote (1062)	11/20/1998 7:52:00 PM
From: ztect	Read Replies (1) \| Respond to of 1754

Why? This is very simple. Credibility and the ability to independently verify information. Fully reporting companies on a Form 10 Q or Form 10 KSB have to reveal all their laundry (dirty and clean) including lawsuits, shares outstanding, officers, financial statements including a profit/loss statement and consolidated financial statement, executive compensation, and other important information that help potential investors make a buying decision. If a company isn't fully reporting, it is sometimes like buying a used car without first having your mechanic look at it. If you know a lot about cars, maybe it isn't so bad. But if you don't, you can get be taken by a "nice", but dishonest fellow, selling you his lemon. Thus having a big name auditor is very important. Continuing with the used car analogy, who would you feel more secure about buying a used car from, the certified dealer reselling a pre-leased certified car (recognized company) or some guy on his lot telling you what a good deal he has? Or, in other words, a recognized auditor (Ernst & Young, Price Waterhouse, Anderson Consulting, et cetera) gives a company credibility through association. Whereas if a company uses a accounting firm that know one has heard of, investors will be less willing to believe the validity of what has been filed in a filing report. When reviewing a balance sheet, positive earnings reported aren't as necessarily as important as positive cash flow and potential for future growth. (E.g. Amazon.com doesn't has never shown earnings). There are many factors you assess when reviewing a balance sheet and a company in a particular sector. Peter Lynch has written several very easy to understand books that you may want to read to understand some of the basics. Though Peter, would tell you and I that we both were crazy investing in BB's. Plus there are also some threads on SI that deal with investment basics to which you might like to refer. Which brings me to my another point, becoming fully reporting is an important first step to getting off the bb's. Getting as quickly off the bb's as possible also means you have to increase share value and meet listing requirements- see this link smallcapinvestor.com Until a company is on the "big boards", it will not attract institutional interest which is what ultimately accounts for increased shareholder value. Read through some of the 10Q's for DELL , for example, to get a feel for what's contained in a report. stocksite.com Finally, even though a company is fully reporting, you should also pay attention to many of the other SEC filing forms like S-8, 144, and 8-k's. Read through them, to find out what they are all about. ztect (spelling not checked)