re: may be about to bounce, page-9

re: may be about to bounce New announcement out that CMQ has agreed that they are guilty of two of the ASIC charges. Will pay $170k ASIC $170k towards their costs plus yet to be determined court imposed fines. At least that is out of the way now.

According to CMQ accounting policy, sales revenue is recognised:
1)When the ownership has passed to the buyer (taken to occur when delivery is made); and
2)When it is probable that the economic benefit will occur.

I have seen, although I have no confirmation, that an investor recieved a reply to an inquiry made about the arrangement with Inviro. According to what this investor said about the reply, CMQ stated that the product had been "positioned" with Inviro - not delivered. Further, Inviro were going to account and pay for sales on the basis of what stock they drew from that supply. As the deal was "not financed by CMQ", Inviro would have to pay for stock taken within, say 30, 60 or 90 days. Since the total receipts for the year are $150k, that means Inviro have not taken more than this amount, unless they did so within the last couple of months for which the payment has yet to arrive. I agree that such sales would be included in revenue even if the cash has not been recieved.

However if Inviro have not drawn the entire shipment, I don't see that this could be included in revenue. Also if Inviro can't or won't pay for the stock, then the economic benefit will not occur so cannot be included in revenue.