The independent auditor for Mega Media Group informed the company and the audit committee of its board of directors that financial statements for the first half of 2008 should not be relied upon and the company has now filed restated results. While that sounds ominous for investors, some of the numbers actually improved. Investors are, after all, more directly impacted by the Chapter 11 proceeding the company commenced in August.
Since the restatement is for a period now more than a year ago, it’s all water over the dam at this point. But here’s the explanation that Mega Media Group filed with the SEC:
“The Company restated its previously reported revenue, operating expenses and selling, general and administrative expenses due to the additional information regarding VSE Magazine, Inc, (Company’s wholly-owned subsidiary) and a contract with the ESJA Enterprises, Inc. The Company also restated its previously reported interest expense as a result of the incorrect calculations of beneficial conversion feature interest expense on notes issued for the six and three months ended July 31, 2008,” Mega Media said in an SEC filing.
For the first half of 2008, Mega Media’s advertising revenues were restated to $566,921 from the previously reported $606,547. Total revenues, however, were restated to $652,705, up from the originally reported $613,079. Operating expenses were restated to $1.541 million from $1.481 million.
On the bottom line, the company’s net loss for the first half of 2008 was restated to $3.162 million, an improvement from the previously reported $3.255 million.
Before filing its Chapter 11 petition for bankruptcy from creditors, Mega Media recorded a $1.674 million loss for Q2 of 2009.
The penny stock company operates “Pulse 87.7” in New York, although it does not own the license for WNYZ-LP.