A booming segment of the Perpetual Motion Machine industry is capitalizing on the hype over the "Hydrogen Economy" with claims to produce Hydrogen for impossibly low cost.

2006-04-29

Curious $1.9 Million Writeoff for Alternate Energy

The latest Annual Report from Alternate Energy Corp includes a curious write-off. What's curious is not the amount or that it's written off, but that this is occurring now and not a year or more ago. First lets take a look at what they say in the latest 10K.
In accordance with SFAS No. 142, "Goodwill and Other Intangible Assets," which was adopted in its entirety on May 22, 2003, we evaluate the carrying value of other intangible assets annually as of December 31 and between annual evaluations if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying amount. When evaluating whether or not the asset is impaired, we compare the fair value of the reporting unit to which the asset is assigned to its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, then the amount of the impairment loss must be measured. The impairment loss would be calculated by comparing the implied fair value of the reporting unit to its carrying amount. The initial evaluation of our patents and technology, completed as of October 1, 2003 in accordance with SFAS No. 142 resulted in no provision for impairment losses being recorded. Additionally, we performed our periodic review of intangible assets for impairment as of December 31, 2005 and identified asset impairment as a result of the review of approximately $1,906,000.

It's interesting that they would point out here that they found no impairment in 2003, but neglect to reiterate what they reported in the 2004 annual report: Additionally, the Company performed its periodic review of its intangible assets for impairment as of December 31, 2004, and did not identify any asset impairment as a result of the review. The company filed suit against Rothman in October 2004 over the asset that was just now written off. The most concise statement of their claim was in their 2005-July 10SB12G/A where they said We alleged in our lawsuit that Rothman had in fact sold the technology to other companies, and on more than one occasion, prior to entering into the agreement with us. We additionally allege that the technology he purported to sell did not work.

So in or before October 2004, they sued Rothman claiming the technology was not his to sell, and didn't work. But two months later, they reviewed it, and found it unimpaired. Then 12 months later they found the impairment. So did something happen in the 12 months between reviews that made the Rothman technology worth less? Since the company recognizes now that the asset is worthless, they should have recognized it in 2004. The 2004 financials should be refilled.

4 Comments:

Blogger Joshua Norton said...

Have you heard of a group in Idaho that claims to have a perpetual motion machine? I didn't think it was possible but they showed me an audit by Ernst and Young that verified it. I take it from your site there's no way. Are any of their claims legit?

Josh Norton

September 27, 2006 11:16 PM

 
Anonymous Anonymous said...

Another one in Idaho? Is there something in the water?

Try to authenticate the report with E&Y. It could be as simple as forgery. On the other hand look at the article above. Auditors will sometimes sign off on complete baloney.

September 28, 2006 1:29 PM

 
Anonymous Anonymous said...

John,

Business Entity Information (ARGY?)

Status: Revoked on 9/1/2005 File Date: 8/2/2004
Type: Domestic Corporation Corp Number: C20561-2004
Qualifying State: NV List of Officers Due: 9/30/2004
Managed By: Expiration Date:

Revoked?What the hell does that mean?

December 13, 2007 8:11 AM

 
Blogger john lichtenstein said...

ARGY is the ticker symbol. The company is
Entity Name Entity Number Status Type
ALTERNATE ENERGY CORP C16473-1997 Active Domestic Corporation

December 13, 2007 6:48 PM

 

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