Add
BRCI.OB to Portfolio
Set Alert
Email to a
Friend
| |||
|
|
Quotes & Info
|
| BRCI.OB > SEC Filings for BRCI.OB > Form 10-K on 1-Apr-2009 | All Recent SEC Filings |
1-Apr-2009
Annual Report
The following is management's discussion and analysis of certain significant factors that have affected our financial position and operating results during the periods included in the accompanying consolidated financial statements, as well as information relating to the plans of our current management. This report includes forward-looking statements. Generally, the words "believes," "anticipates," "may," "will," "should," "expect," "intend," "estimate," "continue," and similar expressions or the negative thereof or comparable terminology are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, including the matters set forth in this report or other reports or documents we file with the Securities and Exchange Commission from time to time, which could cause actual results or outcomes to differ materially from those projected. Undue reliance should not be placed on these forward-looking statements which speak only as of the date hereof. We undertake no obligation to update these forward-looking statements.
The following discussion and analysis should be read in conjunction with our consolidated financial statements and the related notes thereto and other financial information contained elsewhere in this Form 10-K.
We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Our management periodically evaluates the estimates and judgments made. Management bases its estimates and judgments on historical experience and on various factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates as a result of different assumptions or conditions.
RESULTS OF OPERATIONS
Fiscal Year Ended December 31, 2008, Compared to Fiscal Year Ended December 31, 2007
TWELVE MONTHS ENDED DECEMBER 31, 2008 COMPARED TO TWELVE MONTHS ENDED DECEMBER
31, 2007
Sales increased from $-0- for the year ended December 31, 2007 to $172,909 for the year ended December 31, 2008. The increase was all due to the contract with Peacock Productions as previously discussed.
Costs of Sales increased from $-0- for the year ended December 31, 2007 to $84,019 for the year ended December 31, 2008, primarily due to costs associated with the Peacock contract and installation expenses related to the initial beta projects in Florida.
Selling, General, and Administrative Expenses increased from $294,493 for the year ended December 31, 2007 to $1,149,996 for the year ended December 31, 2008 due to additional expenses associated with the operations of AEN. The increase primarily due to additional for employees hired payroll and independent contractors hired by the Company. Payroll and associated costs was approximately $600,000 for the year. Professional fees, promotional, and travel expenses incurred in 2008 for the promotion and sales of the AEN product is also part of the increase in administrative expenses.
Other Income (Expenses) for the years ended December 31, 2008 and 2007 was $25,209 and $43,428 respectively. This income was due to interest/dividend income earned by the Company on investments and interest accrued from the AEN loan. For 2008 income was lower due to lower interest and dividend rates.
As part of the acquisition of AEN the Company had $3,415,747 of Goodwill as a result of the purchase paid for AEN and the Company being responsible for additional more liabilities than assets as part of the acquisition. As a result of the Goodwill and AEN losses for 2008 and projected cash flow for 2009 and 2010 the Company recorded an impairment loss in an amount equal to the entire goodwill amount in 2008. The impairment loss is a result of the Company's annual impairment testing at December 31, 2008 it performs on its intangible assets. See the footnote to the financial statements for further explanation of goodwill impairment.
As a result of the above the net loss increased from a of $250,461 for the year ended December 31, 2007 to $4,451,644 for the year ended December 31, 2008 due to the above analysis of Income and Expenses.
Current Assets
Cash increased from $381,479 on December 31, 2007 to $1,400,058 on December 31, 2008, primarily as a result of private placements previously discussed and noted below in liquidity and capital resources.
Liabilities
Current Liabilities increased from $4,061 at December 31, 2007 to $121,317 at December 31, 2008, due to a larger amount of payables as a result of the AEN operations and $95,000 due to an officer of the Company for prior advances to AEN before the acquisition. .
Liquidity and Capital Resources
We are financing our operations and other working capital requirements principally from the receipt of proceeds from private placements of our securities and from interest income.
On March 24, 2008, the Company accepted subscriptions for 10,000,000 shares of common stock, at a price of $.10 per share, resulting in gross proceeds of $1,000,000. After legal costs and commissions the net proceeds to the Company were approximately $914,000. No other warrants or options are associated with the stock purchase. The common stock issued to U.S. investors was sold based on an exemption from registration pursuant to Section 4(2) and Rule 506 of the Securities Act of 1933 and the common stock issued to non-U.S. investors was sold based on an exemption from registration pursuant to Regulation S of the Securities Act of 1933.
During the second and third quarter of 2008, the Company accepted subscriptions for 9,915,943 shares of common stock, at a price of $.17 per share, resulting in gross proceeds of $1,671,710. After legal costs and commissions the net proceeds to the Company were approximately $1,526,000. No other warrants or options are associated with the stock purchase. The common stock issued to U.S. investors was sold based on an exemption from registration pursuant to Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933 and the common stock issued to non-U.S. investors was sold based on an exemption from registration pursuant to Regulation S of the Securities Act of 1933.
Management intends to use the balance of the proceeds from the offering towards the implementation of the business plan and to provide working capital and/or for future expansion of the Company's operations.
It is probable the Company will require additional capital in order to operate its business and there are no assurances the Company will be able to raise that capital in the future.
Critical Accounting Policies
Accounting Policies and Estimates
The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Our management periodically evaluates the estimates and judgments made. Management bases its estimates and judgments on historical experience and on various factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates as a result of different assumptions or conditions.
As such, in accordance with the use of accounting principles generally accepted in the United States of America, our actual realized results may differ from management's initial estimates as reported. A summary of significant accounting policies are detailed in notes to the financial statements which are an integral component of this filing.
Revenue Recognition
Revenue from product sales is recognized upon shipment to customers at which time such customers are invoiced. Units are shipped under the terms of FOB shipping point when determination is made that collectibility is probable. Revenues for services are recognized upon completion of the services. For consulting services and other fee-for-service arrangements, revenue is recognized upon completion of the services. The Company follows the guidance contained in the Securities and Exchange Commission's Staff Accounting Bulletin (SAB) No. 104, which provides guidance on the recognition, presentation and disclosure of revenue in financial statements.
Stock Based Compensation
|
|