Forecross Corporation Restates
Earnings
July 17, 1998
Contact: Pat Dittmar (Pat@forecross.com)
|
| SAN FRANCISCO, CA: 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:
|
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 |
11,763,612 |
11,763,612 |
|
11,760,469 |
11,760,469 |
| Shares Outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
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 |
11,758,112 |
11,758,112 |
|
|
|
| Shares Outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
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 |
11,750,862 |
11,750,862 |
|
11,681,035 |
11,681,035 |
| Shares Outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
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 |
12,509,343 |
12,509,343 |
|
11,660,638 |
11,660,638 |
| Shares Outstanding |
|
|
|
|
|
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®
offerings. |
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On Behalf of the Board of Directors,
Bernadette C. Castello
Senior Vice President and CFO
Forecross Corporation
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Except for historical information contained herein, the matters set
forth in this release are forward-looking statements that are dependent on certain risks
and uncertainties, including such factors, among others, as market acceptance, market
demand, pricing, changing regulatory environment, changing economic conditions, risks in
new product and service development, the effect of the company’s accounting policies
and other risk factors detailed in the Company’s SEC and BCSC filings.
The U.S. Securities and Exchange Commission has not reviewed and does
not accept responsibility for the adequacy or accuracy of this News Release, which has
been prepared by the Company.
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