Attached files
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8-K/A - 8-K/A - Clarus Corp | v791211_8ka.htm |
EX-23.1 - EX-23.1 - Clarus Corp | v791211_ex23-1.htm |
EX-99.2 - EX-99.2 - Clarus Corp | v791211_ex99-2.htm |
Exhibit 99.1
Independent Auditor’s Report
The Board of Directors
We have audited the accompanying combined balance sheet of PIEPS Holding GmbH and PIEPS GmbH (collectively, “the Company”) as of March 31, 2012, and the related combined statements of income, changes in equity and cash flows for the year then ended. These combined financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these combined financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the combined financial statements referred to above present fairly, in all material respects, the financial position of the Company as of March 31, 2012, and the results of its operations and its cash flows for the year then ended, in conformity with generally accepted accounting principles in Austria.
Accounting principles generally accepted in Austria vary in certain significant respects from U.S. generally accepted accounting principles. Information relating to the nature and effect of such differences is presented in note V. to the combined financial statements.
[s] KPMG Austria AG Wirtschaftsprüfungs- und Steuerberatungsgesellschaft
Vienna, Austria
December 13, 2012
1 |
PIEPS Holding GmbH and PIEPS GmbH
Combined Balance Sheet as of March 31, 2012
(in Euros and thousands)
KEUR | KEUR | |||||||||||
A. | Fixed assets | |||||||||||
I. | Intangible assets | |||||||||||
Concessions, trade mark right and similar rights | 65 | |||||||||||
II. | Tangible assets | |||||||||||
1. | Technical plants and machinery | 67 | ||||||||||
2. | Other property, plant and equipment | 97 | ||||||||||
3. | Prepayments on assets under construction | 167 | ||||||||||
331 | ||||||||||||
396 | ||||||||||||
B. | Current assets | |||||||||||
I. | Inventories | |||||||||||
Merchandise | 978 | |||||||||||
II. | Receivables and other current assets | |||||||||||
1. | Trade receivables | 750 | ||||||||||
2. | Other accounts receivables and current assets | 117 | ||||||||||
867 | ||||||||||||
III. | Cash and cash equivalents | 38 | ||||||||||
1,883 | ||||||||||||
C. | Prepaid expenses | |||||||||||
Other prepaid expenses | 1 | |||||||||||
Total Assets | 2,280 | |||||||||||
A. | Shareholder's equity | |||||||||||
I. | Combined share capital | 168 | ||||||||||
II. | Combined retained earnings and profits | 288 | ||||||||||
456 | ||||||||||||
B. | Provisions | |||||||||||
1. | Provision for taxes | 14 | ||||||||||
2. | Provisions for severance indemnity | 9 | ||||||||||
3. | Other provisions and accruals | 373 | ||||||||||
396 | ||||||||||||
C. | Liabilities | |||||||||||
1. | Bank loans and overdrafts | 670 | ||||||||||
2. | Trade payables | 157 | ||||||||||
3. | Liabilities against affiliated companies | 400 | ||||||||||
4. | Other liabilities | 201 | ||||||||||
1,428 | ||||||||||||
Total Equity and Liabilities | 2,280 | |||||||||||
Contingent Liabilities | 11 |
2 |
PIEPS Holding GmbH and PIEPS GmbH
Combined Income Statement for the Fiscal Year 2012
(in Euros and thousands)
2011/12 | 2011/12 | |||||||||||
KEUR | KEUR | |||||||||||
1. | Revenue | 6,018 | ||||||||||
2. | Other operating income | |||||||||||
a) | Other income | 107 | ||||||||||
107 | ||||||||||||
3. | Expenses for materials and other purchased services | |||||||||||
a) | Expenses for materials | (892 | ) | |||||||||
b) | Expenses for services | (2,199 | ) | |||||||||
(3,091 | ) | |||||||||||
4. | Personnel expenses | |||||||||||
a) | Wages | (23 | ) | |||||||||
b) | Salaries | (560 | ) | |||||||||
c) | Expenses for severance payments and contributions to respective funds | (9 | ) | |||||||||
d) | Expenses for statutory social security and payroll related taxes and contributions | (147 | ) | |||||||||
e) | Other employee benefits | (14 | ) | |||||||||
(753 | ) | |||||||||||
5. | Depreciation on intangible assets and tangible assets | (123 | ) | |||||||||
6. | Other operating expenses | |||||||||||
a) | Taxes, other than income taxes | - | ||||||||||
b) | Other expenses | (1,567 | ) | |||||||||
(1,567 | ) | |||||||||||
7. | Operating result = | |||||||||||
Subtotal of lines 1 to 6 | 591 | |||||||||||
8. | Other interest and similar income | 3 | ||||||||||
9. | Interest and similar expenses | (48 | ) | |||||||||
10. | Financial result = | |||||||||||
Subtotal of lines 8 and 9 | (45 | ) | ||||||||||
11. | Profit from ordinary business operations | 546 | ||||||||||
12. | Taxes on income and earnings | (167 | ) | |||||||||
13. | Net income for the year | 379 | ||||||||||
14. | Combined loss carryforward | (91 | ) | |||||||||
15. | Combined retained earnings and profits | 288 |
3 |
PIEPS Holding GmbH and PIEPS GmbH
Combined Statement of Changes in Equity for the Fiscal Year 2012
(in Euros and thousands)
Combined share capital | Retained earnings | Net profit | Total equity | |||||||||||||
in EUR | KEUR | KEUR | KEUR | KEUR | ||||||||||||
Balance as of April 1, 2011 | 168 | 389 | - | 557 | ||||||||||||
Dividends to third-parties | - | (480 | ) | - | (480 | ) | ||||||||||
Net income for the year | - | - | 379 | 379 | ||||||||||||
Balance as of March 31, 2012 | 168 | (91 | ) | 379 | 456 |
4 |
PIEPS Holding GmbH and PIEPS GmbH
Combined Statement of Cash Flows for the Fiscal Year 2012
(in Euros and thousands)
2012 | ||||
KEUR | ||||
Net income for the year | 379 | |||
Depreciation of fixed assets | 123 | |||
Change in inventories, advances paid and prepaid expenses | (379 | ) | ||
Change in trade receivables, receivables from affiliated companies and other receivables and assets | (32 | ) | ||
Change in trade payables, liabilities to affiliated companies and other payables | 199 | |||
Change in short-term provisions and accruals | 79 | |||
CASH FLOW FROM OPERATING ACTIVITIES | 369 | |||
Investments in fixed assets | (139 | ) | ||
CHASH FLOW FROM INVESTING ACTIVITIES | (139 | ) | ||
Dividends | (480 | ) | ||
Proceeds from short-term loans | 240 | |||
CASH FLOW FROM FINANCING ACTIVITIES | (240 | ) | ||
CHANGE IN CASH AND CASH EQUIVALENTS | (10 | ) | ||
Opening Balance of cash and cash equivalents | 48 | |||
Closing balance of cash and cash equivalents | 38 |
5 |
PIEPS Holding GmbH and PIEPS GmbH
Notes to Combined Financial Statements
(in Euros and in thousands)
I. | EXPLANATION OF ACCOUNTING POLICIES |
1. | General |
Basic Principles
The combined financial statements have been prepared in accordance with the financial reporting requirements of the Austrian Commercial Code (Unternehmensgesetzbuch, UGB), as amended.
The annual financial statements of the combined entities, prepared on the basis of standards applied consistently throughout, form the basis for these combined financial statements.
All companies prepare their annual financial statements for the year ended March 31.
The combined financial statements are prepared in thousands of Euros ("KEUR").
Basis for Combined Financial Statements
The combined financial statements comprise PIEPS Holding GmbH and PIEPS GmbH (“PIEPS” or the “Company”). These entities were under control of Seidel Privatstiftung and its beneficiaries. Effective April 1, 2012, PIEPS Holding GmbH merged with PIEPS GmbH. We adjusted the financial statements as of March 31, 2012 for known subsequent events occurring since the financial statements as of March 31, 2012 were prepared.
Method of the Combination
The combined financial statements of PIEPS eliminate the impacts of all intercompany transactions and accounts.
Accounting Policies
These combined financial statements have been prepared in accordance with Austrian generally accepted accounting principles and the general standard of presenting a true and fair view of the net assets, financial position and results of operations of the Company.
The combined financial statements have been prepared in accordance with the principle of completeness. The principle of item-by-item measurement was applied to the measurement of individual assets and liabilities and the continued existence of the Company as a going concern was assumed. Compliance with the prudence principle was ensured by reporting only those profits that had been realized as at the balance sheet date. All identifiable risks and expected losses were taken into account. The measurement methods used previously were retained in the preparation of these combined financial statements.
2. | Foreign Currency Translation |
Receivables denominated in a foreign currency are stated at the exchange rate at the date of transaction or the closing rate at the date of the statement of financial position, if lower.
Liabilities denominated in a foreign currency are stated at the exchange rate at the date of transaction or the closing rate at the date of the statement of financial position, if higher.
6 |
PIEPS Holding GmbH and PIEPS GmbH
Notes to Combined Financial Statements - Continued
(in Euros and in thousands)
3. | Fixed Assets |
a) | Intangible Assets |
Purchased intangible assets are measured at cost less straight-line amortization, with the exception of trade mark rights which are not amortized as they have an indefinite life. Amortization is based on the following useful lives:
IT and software | 3-5 years | ||
Other rights | 3-5 years |
Material permanent impairment is accounted for by recognizing write-downs for impairment.
Internally generated intangible assets are not capitalized.
b) | Tangible Assets |
Tangible assets are measured at cost less depreciation. Low-value assets with an individual cost of up to KEUR 1 are fully expensed in the year of acquisition. In the schedule of changes in fixed assets, they are reported as additions, disposals and depreciation of the financial year in which they were acquired. Tangible assets are depreciated using the straight-line method over the expected useful life. Depreciation is based on the following useful lives:
Technical plants and machinery | 3-11 years | ||
Other property, plant and equipment | 3-11 years |
Depreciation is based on the half-year convention, where assets purchased during the first six months of the year are subject to a full year's depreciation and assets purchased in the second half of the year are subject to six months depreciation regardless of the actual date placed in service.
Additional write-downs in excess of regular depreciation are recognized, if impairment occurs which is expected to be permanent.
4. | Current Assets |
a) | Inventories |
Merchandise is measured at the lower of cost or market prices.
b) | Receivables and Other Current Assets |
Receivables and other current assets are recognized at their nominal amounts.
If there are identifiable individual risks, the lower fair value is determined and these assets are recognized at this value. Securities classified as current assets are measured at the lower of cost or market value as at the balance sheet date.
c) | Cash and Cash Equivalents |
Cash and cash equivalents comprise cash in hand and bank balances.
7 |
PIEPS Holding GmbH and PIEPS GmbH
Notes to Combined Financial Statements - Continued
(in Euros and in thousands)
5. | Provisions |
There were KEUR 9 in obligations for severance payments as at the balance sheet date that require a provision.
Provisions for long-service awards were calculated according to actuarial principles applying an imputed interest rate of 4%. A staff turnover discount of 75% was applied. According to management's assessment, the discount is appropriate given the current personnel structure and special circumstances of the sector. Payments of long-service awards will become due in twenty-five years' time at the earliest. Management therefore expects long-service award payments to occur with a probability of 20%.
The provisions for taxes relate to the provisions for corporate income tax that has not yet been assessed.
In compliance with the principle of prudence, other provisions and accruals are recognized, according to prudent business judgment, for all identifiable risks and contingent liabilities identifiable as at the time the financial statements are prepared.
6. | Liabilities |
Liabilities are recognized at their repayment amount, in compliance with the prudence principle.
II. | BALANCE SHEET DISCLOSURES |
To improve the clarity of presentation in the balance sheet, individual items have been combined. Where required, separate disclosures are made in the notes to the individual balance sheet items.
1. | Fixed Assets |
Low-value assets are expensed in the year of addition and reported as additions and disposals in the schedule of changes in fixed assets. The changes in individual fixed assets and the breakdown of annual depreciation, amortization and write-downs are as follows:
Combined Fixed Asset Schedule as of March 31, 2012
(in Euros and thousands)
Cost of acquisition April 1, 2011 | Additions | Disposal | Cost of acquisition March 31, 2012 | Accumulated depreciation and amortization | Book value March 31, 2012 | Book value April 1, 2011 | Depreciation and amortization for the Fiscal Year | |||||||||||||||||||||||||||
Asset item | KEUR | KEUR | KEUR | KEUR | KEUR | KEUR | KEUR | KEUR | ||||||||||||||||||||||||||
I. | Intangible assets | |||||||||||||||||||||||||||||||||
Concessions, trade mark right and similar rights | 252 | 16 | - | 268 | 203 | 65 | 56 | 7 | ||||||||||||||||||||||||||
II. | Tangible Assets | |||||||||||||||||||||||||||||||||
1. | Technical plants and machinery | 361 | 5 | - | 366 | 299 | 67 | 122 | 61 | |||||||||||||||||||||||||
2. | Other property, plant and equipment | 280 | 52 | 6 | 326 | 229 | 97 | 100 | 55 | |||||||||||||||||||||||||
641 | 57 | 6 | 692 | 528 | 164 | 222 | 116 | |||||||||||||||||||||||||||
III. | Prepayments | |||||||||||||||||||||||||||||||||
Prepayments on assets under construction | 101 | 66 | - | 167 | - | 167 | 102 | - | ||||||||||||||||||||||||||
994 | 139 | 6 | 1,127 | 731 | 396 | 380 | 123 |
2. | Inventories |
The inventories reported in the balance sheet relate to merchandise and include provisions for slow movers.
8 |
PIEPS Holding GmbH and PIEPS GmbH
Notes to Combined Financial Statements - Continued
(in Euros and in thousands)
3. | Receivables and Other Current Assets |
The receivables and other current assets reported in the balance sheet comprise the following items and maturities:
Due | ||||||||||||||
Total | within 1 year | after 1 year | ||||||||||||
Receivables at March 31, 2012 | KEUR | KEUR | KEUR | |||||||||||
1. | Trade receivables | 750 | 750 | - | ||||||||||
2. | Other receivables and assets | 117 | 117 | - | ||||||||||
Receivables and other current assets | 867 | 867 | - |
4. | Shareholder’s Equity |
As at March 31, 2012, the share capital amounted to KEUR 35.
5. | Provisions |
The provisions changed as follows:
Balance at April 1, 2011 | Release reversal | Additions | Balance at March 31, 2012 | |||||||||||||
Provisions for taxes | KEUR | KEUR | KEUR | KEUR | ||||||||||||
For corporate income tax | 23 | (23 | ) | 14 | 14 |
Balance at April 1, 2011 | Release reversal | Additions | Balance at March 31, 2012 | |||||||||||||
Other provisions and accruals | KEUR | KEUR | KEUR | KEUR | ||||||||||||
Other provisions and accruals | 330 | (176 | ) | 228 | 382 |
6. | Liabilities |
The liabilities reported in the balance sheet comprise the following items and maturities:
Due | ||||||||||||||||||||||
Total | within 1 year | in 1 to 5 years | after 5 years | Secured by collateral | ||||||||||||||||||
Receivables at March 31, 2012 | KEUR | KEUR | KEUR | KEUR | KEUR | |||||||||||||||||
1. | Bank loan and overdrafts | 670 | 571 | 99 | - | - | ||||||||||||||||
2. | Trade payables | 157 | 157 | - | - | - | ||||||||||||||||
3. | Liabilities against affiliated companies | 400 | 400 | - | - | - | ||||||||||||||||
4. | Other payables | 201 | 61 | 140 | - | - | ||||||||||||||||
Total liabilities | 1,428 | 1,189 | 239 | - | - |
Other payables do not include any material accrued expenses payable after the balance sheet date.
7. | Contingent Liabilities |
Below the balance sheet as of March 31, 2012 are contingent liabilities of KEUR 11, which are related to bank guarantees for the security deposit on the rent of the Company’s office space.
9 |
PIEPS Holding GmbH and PIEPS GmbH
Notes to Combined Financial Statements - Continued
(in Euros and in thousands)
8. | Other Financial Obligations |
Obligations from the Use of Property, Plant and Equipment Not Recognized in the Balance Sheet
We forecast the future rental and lease obligations as follows:
March 31, 2012 | ||||
KEUR | ||||
For the next fiscal year | 110 | |||
For the next five fiscal years | 443 |
III. | INCOME STATEMENT DISCLOSURES |
To improve the clarity of presentation in the income statement, individual items have been combined. Where required, separate disclosures are made in the notes to the individual income statement items.
1. | Revenue |
Revenue breaks down as follows:
2011/12 | ||||
By geographically defined market | KEUR | |||
Domestic revenue | 2,173 | |||
Foreign revenue | 3,845 | |||
6,018 |
Revenue by geographically defined market is determined by the location of the seller and therefore domestic revenue also includes revenues to customers located outside of Austria.
2. | Expenses for Severance Payments and Contributions to Respective Funds |
The total amount of expenses to severance payments of KEUR 1 and contributions to respective funds of KEUR 8 in the financial year 2011/2012 is KEUR 9.
10 |
PIEPS Holding GmbH and PIEPS GmbH
Notes to Combined Financial Statements - Continued
(in Euros and in thousands)
IV. | OTHER DISCLOSURES |
1. | Average Headcount |
2011/12 | ||||
Wage earners | 1 | |||
Salaried employees | 9 | |||
Total | 10 |
2. | Members of Management |
During 2011/2012, the following persons were members of the board of managers of PIEPS Holding GmbH and PIEPS GmbH:
· | Ing. Michael Schober |
· | Dr. Maximilian Seidel (until October 1, 2012) |
· | Peter Metcalf (since October 1, 2012) |
· | Scot Carlson (since October 1, 2012) |
· | Robert Peay (since October 1, 2012) |
3. | Disclosures Relating to Members of Executive Bodies |
Disclosure of the amount of remuneration paid to the members of the management is omitted pursuant to the safeguard clause of section 241 (4) UGB (less than 3 members on the management board).
V. | SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN AUSTRIAN GAAP AND U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (“GAAP”) |
The combined financial statements of PIEPS have been prepared in accordance with Austrian GAAP, which differ in certain significant respects from U.S. GAAP. The effects of the application of U.S. GAAP to net income and equity are set out in the tables below:
2011/12 | ||||||||
Note | KEUR | |||||||
Net income reported under Austrian GAAP | 379 | |||||||
U.S. GAAP adjustments: | ||||||||
Property and equipment | a) | (2 | ) | |||||
Inventory costing and overheads | b) | 9 | ||||||
Foreign currency translation | c) | (2 | ) | |||||
Sales agent accrual | d) | 34 | ||||||
Income tax effect | e) | (1 | ) | |||||
Net income reported under U.S. GAAP | 417 |
11 |
PIEPS Holding GmbH and PIEPS GmbH
Notes to Combined Financial Statements - Continued
(in Euros and in thousands)
March 31, 2012 | ||||||||
Note | KEUR | |||||||
Equity reported under Austrian GAAP | 456 | |||||||
U.S. GAAP Adjustments: | ||||||||
Property and equipment | a) | (2 | ) | |||||
Inventory costing and overheads | b) | 24 | ||||||
Foreign currency translation | c) | (2 | ) | |||||
Sales agent accrual | d) | 225 | ||||||
Income tax effect | e) | (5 | ) | |||||
Equity reported under U.S. GAAP | 696 |
a) | Under Austrian GAAP, tangible assets are depreciated using a half year convention. Under U.S. GAAP, they are depreciated when put into service on a monthly pro-rata basis. |
b) | Under Austrian GAAP, PIEPS has elected not to capitalize any overhead costs. Under U.S. GAAP, the portion of variable and fixed overheads directly related to inventory are capitalized. |
c) | Under Austrian GAAP, accounts receivable and accounts payable denominated in a currency other than the functional currency (i.e., EUR for PIEPS) are to be remeasured at the lower of/higher of exchange rate on initiation date and balance sheet date. Under U.S. GAAP, all amounts are to be remeasured at the exchange rate as of the balance sheet date. |
d) | Under Austrian GAAP, an accrual is required for contingent payments that may need to be paid to a sales agent in case of a termination without cause. Under U.S. GAAP, an accrual may only be recorded for a liability. |
e) | Tax effect of 25% corporate tax for temporary differences between Austrian tax law and U.S. GAAP. |
12 |