YuuZoo Corp (Formerly W Corp)

SGX did a query to Yuuzoo recently on their FY16 results and they replied today. The 2nd query asked about their "15.8mil receivables wrote down, requiring a restatement for FY15 results" and there was this part of the reply that i found puzzling:

YZ Group paid in cash to YuuZoo all of their invoices on the dates that they were due. In 2015, after some invoices remained unpaid past due date, YuuZoo agreed with YZ Group that YZ Group would settle the debt remaining by transferring to YuuZoo its Mexico franchise, for which YuuZoo had a valuation done by an independent valuer. The valuation confirmed that the Mexico franchise was worth more than what was owed to YuuZoo by YZ Group. YuuZoo’s decision in 2017 to delink the valuation of the franchisees from the franchise license fee and to take a more conservative approach and book a lower revenue in the form of the lower license fee has a direct impact also on the book value of the Mexico franchise. The decision to book a lower franchise fee means the book value of the Mexico franchise no longer covers the YZ Group debt. Accordingly, the Company decided to write off the YZ Group debt.

Yuuzoo seems to mention that that they had to write off their receivables because they changed the revenue recognition model to book lower revenue from its franchisees, resulting in lower book value of they own. Another part of the PR also mentions that Yuuzoo still prefers payment from franchisees in their (franchisee) own shares. While i am not accounting-trained, but it seems to be a circular cycle. If Yuuzoo inflate the revenue from their franchisee, then it will be able to increase the book value of its franchisee. Since it owns shares of its franchisees as payment for fees, then its own book value will be increased. Accounting is interesting!

http://infopub.sgx.com/FileOpen/Announce...eID=445155

It's actually similar to some developers that own REITS (read rental support) except there is likely lack of substance in Yuuzoo's franchisees

Usually book value is marked down to market or cost, whichever lower, to prevent the circular issue you mentioned (unless there is an actual sale of the asset). There is of course loopholes when you see companies switch assets between >50% consolidated entity to <50% associates, depending which way suit their purpose.

Monkey business at YuuZoo?
http://www.theedgesingapore.com/monkey-business-yuuzoo

(07-07-2017, 05:35 PM)Behappyalways Wrote: Monkey business at YuuZoo?
http://www.theedgesingapore.com/monkey-business-yuuzoo

After 5 CFO changes since RTO as indicated in the article, the latest CFO lasted barely more than 4 months and wants to move back to Finland.

http://infopub.sgx.com/Apps?A=COW_CorpAn...uddies.com

(15-07-2017, 10:51 AM)weijian Wrote:

(07-07-2017, 05:35 PM)Behappyalways Wrote: Monkey business at YuuZoo?
http://www.theedgesingapore.com/monkey-business-yuuzoo

After 5 CFO changes since RTO as indicated in the article, the latest CFO lasted barely more than 4 months and wants to move back to Finland.

http://infopub.sgx.com/Apps?A=COW_CorpAn...uddies.com

Immediate Resignation.
He is literally running away and not walking away from it.

Interesting announcement by YuuZoo. Executive Chairman's stepping down during the period for 3rd party independent investigation on all the recent claims/statements. So he is choosing "flight" over "fight" (he could jolly well choose to sue BT and then risk having a NKF 2.0 i suppose?)

NTU professor was also invited to join YuuZoo to help to make changes - pretty cheeky move IMO. But generally any academic choose reputation over money, any time.

ANNOUNCEMENT IN RELATION TO RECENT ARTCILES IN BUSINESS TIMES

http://infopub.sgx.com/FileOpen/17017_Yu...eID=461681

Finally SGX take action 👊

http://www.businesstimes.com.sg/companie...-at-yuuzoo

Another great company whose core business is to sell hope to shareholders. Think they will do well helping to frame government policy responses in positive light.

Published October 05, 2017
First published in Business Times on October 6, 2017
By Mak Yuen Teen

ON October 2, YuuZoo Corporation (YuuZoo) announced that it has added two new independent directors from Finland and five new members to its top management team. It added that with the two new board appointments, four out of the six board members are from Finland, which it said is ranked No 1 on the 2017 list of the World?s Most Transparent Countries and is outstanding in corporate governance based on the 2017 World Corporate Governance Index.
Good corporate governance is not just about adding board members with impressive profiles (or from reputable countries). Companies such as Enron, Satyam and Theranos, just to name a few, had boards stacked with impressive names but that did not prevent them from imploding in scandals.
The fact that YuuZoo has a founder and chairman from Finland has not stopped serious and unanswered questions being raised about its corporate governance, disclosures and accounting practices.
Further, YuuZoo's principal place of business is not Finland. It is therefore unclear why adding more board members from there would improve the board?s oversight role or YuuZoo's overall corporate governance.

Looks like hope is fading soon

http://www.smh.com.au/business/media-and...yulpx.html

Singapore Exchange Regulation Pte Ltd Suspends Trading in the Shares of YuuZoo Corporation Limited

The Exchange makes reference to its announcement dated 5 March 2018 (Announcement Reference No.: SG180305OTHRXGEA) in relation to the Notice of Compliance (NOC) issued to the Company on the same day.

In the NOC, pursuant to Listing Rule 1405(1)(b), for the purposes of ensuring that the market is fair, orderly and transparent, the Exchange requires the Company to make specified disclosures by 19 March 2018 of the opinion of its statutory auditors on the veracity and reasonableness of the following items in its consolidated financial statements:-

(a) Other income of S$8.0 million due to the purchase of assets related to the formation of YuuLog France for the financial year ended 31 December 2017 (FY2017); and

(b) Balance of assets available for sale of S$54.2 million as at 31 December 2017 and corresponding revenue of S$38.4 million from network development and franchise sales for FY2017.

The statutory auditors of the Company have informed the Exchange and the Company today that they are unable to obtain sufficient appropriate audit evidence in order to provide an opinion as required in the NOC.

Pursuant to Listing Rule 1303(5), in the interest of maintaining a fair, orderly and transparent market, the Exchange will suspend trading in the shares of the Company with immediate effect.