Attached files
file | filename |
---|---|
EX-99.2 - EXHIBIT 99.2 - MEDICUS HOMECARE INC. | exhibit99-2.htm |
EX-99.1 - EXHIBIT 99.1 - MEDICUS HOMECARE INC. | exhibit99-1.htm |
EX-99.4 - EXHIBIT 99.4 - MEDICUS HOMECARE INC. | exhibit99-4.htm |
8-K/A - FORM 8-K/A - MEDICUS HOMECARE INC. | form8ka.htm |
EX-99.6 - EXHIBIT 99.6 - MEDICUS HOMECARE INC. | exhibit99-6.htm |
EX-99.5 - EXHIBIT 99.5 - MEDICUS HOMECARE INC. | exhibit99-5.htm |
- 1 -
Das Pflegeland
(sole proprietorship)
Report on the Review of the Interim Financial Statements
as of June 30, 2014
for the Period of January 1 until June 30, 2014
(Expressed in Euros)
RBS RoeverBroennerSusat | |
GmbH & Co. KG | |
Wirtschaftsprüfungsgesellschaft | |
Steuerberatungsgesellschaft | |
Gervinusstraße 15 | |
60322 Frankfurt am Main | |
T +49 69 500 60-0 | |
F +49 69 500 60-2050 | |
www.rbs-partner.de |
- 2 -
Report on Review of Interim Financial Information
To the Owner of Das Pflegeland (sole proprietorship), Stuttgart
We have reviewed the accompanying balance sheets of Das Pflegeland as of June 30, 2014 and December 31, 2013 and the related statements of operations, stockholders deficit and cash flows for the years then ended. These interim financial statements are the responsibility of the Proprietor. Our responsibility is to express an opinion on these financial statements based on our review.
We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform a review to obtain reasonable assurance whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, a review of its internal control over financial reporting. Our review included consideration of internal control over financial reporting as a basis for designing review procedures that are appropriate under the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control over financial reporting. Accordingly, we express no such opinion. A review also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. A review also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our review provides a reasonable basis for our opinion.
In our opinion, these financial statements present fairly, in all material respects, the financial position of Das Pflegeland as of June 30, 2014 and December 31, 2013 and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.
Frankfurt am Main, February 6, 2015
RBS RoeverBroennerSusat GmbH & Co.KG
Wirtschaftsprüfungsgesellschaft
Steuerberatungsgesellschaft
- 3 -
Das Pflegeland (sole proprietorship)
Balance Sheets
As of June 30, 2014 and as of December 31, 2013
2014 | 2013 | |||||
Euro | Euro | |||||
ASSETS | ||||||
Non-current Assets | ||||||
Intangible Assets | ||||||
Software licenses | 3,00 | 3,00 | ||||
Property, Plant and Equipment | ||||||
Land, property rights and buildings, including buildings on third party land | 43.531,65 | 43.851,65 | ||||
Other equipment, furniture and fixtures | 37.195,29 | 41.110,00 | ||||
Financial Assets | ||||||
Claim from proprietor because of transfer from reserves | 57.194,77 | 532.311,95 | ||||
Total non-current Assets | 137.924,71 | 617.276,60 | ||||
Current Assets | ||||||
Trade receivables | 327.937,86 | 336.092,74 | ||||
Other assets | 27.349,78 | 20.787,60 | ||||
Cash and cash equivalents | 90.565,78 | 0,00 | ||||
Total Current Assets | 445.853,42 | 356.880,34 | ||||
TOTAL | 583.778,13 | 974.156,94 | ||||
LIABILITIES AND PROPRIETORS EQUITY | ||||||
Proprietors Equity | ||||||
Initial capital | 0,00 | 0,00 | ||||
Capital contribution | 426.679,68 | 568.992,12 | ||||
Transfer from reserves | -228.083,22 | -1.697.174,18 | ||||
Net profit for the year | 276.520,72 | 767.387,19 | ||||
Adjustment item claim from proprietor | -475.117,18 | 360.794,87 | ||||
Total Proprietors Equity | 0,00 | 0,00 | ||||
Non-current Liabilities | ||||||
Long-term financial liabilities | 55.000,00 | 55.000,00 | ||||
Total non-current Liabilities | 55.000,00 | 55.000,00 | ||||
Current Liabilities | ||||||
Short-term financial liabilities | 199.138,78 | 711.470,06 | ||||
Accruals | 39.612,98 | 35.599,25 | ||||
Other liabilities | 271.923,77 | 160.583,04 | ||||
Provisions | 18.102,60 | 11.504,59 | ||||
Total Current Liabilities | 528.778,13 | 919.156,94 | ||||
TOTAL | 583.778,13 | 974.156,94 |
- 4 -
Das Pflegeland (sole proprietorship)
Statement of
Operations for the period from January 1 to June 30, 2014 and to December 31,
2013
2014 | 2013 | |||||
Euro | Euro | |||||
Revenue | 1.584.263,40 | 2.791.296,33 | ||||
Other income | 23.472,13 | 44.252,12 | ||||
1.607.735,53 | 2.835.548,45 | |||||
Cost of purchased services | 245.140,49 | 279.617,11 | ||||
Personnel expenses | 896.774,53 | 1.427.319,02 | ||||
Depreciation and amortization of intangible and tangible fixed assets | 7.013,70 | 14.722,90 | ||||
Other operating expenses | 170.344,03 | 303.441,73 | ||||
Other interest and similar income | 91,38 | 341,78 | ||||
Interest and similar expenses | 12.033,44 | 43.402,28 | ||||
Net profit of the year | 276.520,72 | 767.387,19 |
- 5 -
Das Pflegeland (sole proprietorship)
Statements of
Changes in Equity
Proprietors | |||
Equity | |||
Euro | |||
Balance as of December 31, 2012 | 0,00 | ||
Capital contribution | 568.992,12 | ||
Transfer from reserves | -1.697.174,18 | ||
Net profit for the year | 767.387,19 | ||
Adjustment item claim against proprietor | 360.794,87 | ||
Balance as of December 31, 2013 | 0,00 | ||
Capital contribution | 426.679,68 | ||
Transfer from reserves | -228.083,22 | ||
Net profit for the year | 276.520,72 | ||
Adjustment item claim from proprietor | -475.117,18 | ||
Balance as of June 30, 2014 | 0,00 |
- 6 -
Das Pflegeland (sole proprietorship)
Statements of Cash Flow for the period from January 1 to June 30, 2014 and to December 31, 2013
2014 | 2013 | |||||
Euro | Euro | |||||
Net profit of the year | 276.520,72 | 767.387,19 | ||||
Adjustments to the consolidated net profit for the year for | ||||||
reconciliation to the cash flow operating activities: | ||||||
- Finance revenues | 91,38 | -670,81 | ||||
+ Finance costs | -12.033,44 | 50.835,95 | ||||
Operating profit | 264.578,66 | 817.552,33 | ||||
+ Amortization and depreciation | 7.013,70 | 14.722,90 | ||||
271.592,36 | 832.275,23 | |||||
-/+ Increase/decrease in inventories, trade receivables and other assets | 1.592,70 | -76.049,93 | ||||
+/- Increase/decrease in provisions | 6.598,01 | -7.077,06 | ||||
+/- Increase/decrease in trade payables and other liabilities | 115.354,46 | 43.280,15 | ||||
Cash flows from operating activities | 395.137,53 | 792.428,39 | ||||
- Payments of intangible assets and property, plant and equipment | -2.778,99 | -538,90 | ||||
+ Interest receipts | -91,38 | 670,81 | ||||
Cash flows from investing activities | -2.870,37 | 131,91 | ||||
- Transfer from reserves | -228.083,22 | -1.697.174,18 | ||||
+ Capital contribution | 426.679,68 | 568.992,12 | ||||
- Payments from redemption of debt and loans | -10.717,04 | -25.082,51 | ||||
+/- Change in short-term bank liabilities | -500.297,84 | 245.121,76 | ||||
- Payment of interest | 10.717,04 | 25.082,51 | ||||
Cash flows from financing activities | --301.701,38 | -883.060,30 | ||||
Net change in cash and cash equivalents | 90.565,78 | -90.500,00 | ||||
+ Cash and cash equivalents at beginning of the period | 0,00 | 90.500,00 | ||||
Cash and cash equivalents at the end of the period | 90.565,78 | 0,00 |
- 7 -
Das Pflegeland (sole proprietorship)
Notes to the
financial statements
Expressed in Euros
June 30, 2014
A. |
General Information and Basis of Presentation |
1. |
General Information |
Domicile and Legal Form of the
Company
Das Pflegeland is a care enterprise managed by Dr. Orhan
Karahodza in the legal form of a sole proprietorship. The proprietorship
is domiciled in Badestraße 36, 70372 Stuttgart, Germany.
Business Activities
As care
service provider Das Pflegeland is engaged in the medical homecare and
specialized in acute posthospital treatment and breathing improvement or rather
the control of long-time home breathing. Das Pflegeland is able to take over
the breathing care of all breathing patients with different clinical pictures
within 24 hours:
- ALS - amyotrophic lateral
sclerosis
- Persistent vegetative state
- Chronic obstructive pulmonary
disease (COPD)
- Pneumonia
- Respiratory insufficiency
- Apoplectic
stroke (Apoplexy)
General Principles and Accounting
Standards
The present financial statements of the sole proprietorship
Das Pflegeland for the period from January 1 to June 30, 2014 are presented in
Euro (EUR) and have been prepared in conformity with generally accepted
accounting principles in the United States of America (US GAAP) in accordance
with the Financial Accounting Standards Board ("FASB") Accounting Standards
Codification ("ASC").
Recently Issued Accounting
Pronouncements
The Company has implemented all new accounting
pronouncements that are in effect and that may impact its financial statements
and does not believe that there are any other new accounting pronouncements that
have been issued that might have a material impact on its financial position or
results of operations.
- 8 -
Estimates and Assumptions
The preparation of the financial statements in conformity with U.S. GAAP
requires estimates and assumptions to be made by the proprietor. These influence
the assessment of assets and liabilities, the disclosure of contingent
liabilities at the balance sheet date as well as the presentation of income and
expenditures for the period under review.
In particular, this relates to allowances for bad debts, the amount and likelihood of utilization of other provisions as well as the economic lifetime of assets. The Proprietor bases his judgment of these assumptions and estimates on past experience and the results of carefully weighing up different scenarios. Changes in the economic situation that deviate from the assumptions applied and that lie beyond the control of the proprietor may result in the actual amounts differing from the original estimates. If the original basis of estimation changes, accounting for the respective balance sheet items will be adjusted with an effect on the income statement.
2. |
Accounting and Valuation Principles |
Intangible Assets
Intangible
Assets which were acquired in return for payment are carried at cost, reduced by
normal straight-line amortization from the date on which they are first ready
for use. Amortizations will be taken straight-line above the economic useful
life of two to three years.
Property, Plant and
Equipment
Property, plant and equipment is carried at cost less
cumulative depreciation. Depreciation is recognized on a straight-line basis
over the expected useful life of the asset. Expenditure for maintenance and
repairs is expensed in the period in which it is incurred. The cost of an asset
and the related cumulative depreciation are derecognized when assets are
scrapped or disposed of, with any book gains or losses recognized in the income
statement under Other operating income or Other operating expenses. Fifty
years were assumed as useful life expectancy for buildings. The expected useful
life for the other assets is calculated between two and ten years.
Accordingly, low-value assets with an acquisition value of no more than EUR 410 are fully depreciated in the year of acquisition. All other assets with acquisition values greater than this are capitalized and depreciated over their normal useful lives.
Impairment and Write-downs of
Intangible Assets and Property, Plant and Equipment
Where the value of
intangible assets or property, plant and equipment calculated using the
principles described above is greater than the value attributed to them at the
balance sheet date, impairment losses and write-downs are recognized
accordingly. The fair value to be applied is calculated on the basis of either
the net proceeds of sale or the present value of the estimated future cash flows
from the use of the asset whichever is higher. Impairment losses and
write-downs are reported in other operating expenses.
Receivables and other assets
Receivables and other assets are carried at the nominal value.
Appropriate bad debt allowances are recognized for trade receivables in order to
cover possible default risks.
Cash
Cash comprises all
freely available liquid funds such as cash in hand and cash in current accounts,
as well as other current bank balances available.
- 9 -
Payables
Liabilities are
carried at amortized cost on the balance sheet date, which generally corresponds
to the amount due on settlement.
Accruals
Accruals are
liabilities payable for goods or services received that are neither paid nor
invoiced by the supplier at the balance sheet date.
Other Provisions
Provisions
for other financial obligations are recognized when a present obligation towards
a third party arises from a past event, future settlement is probable and the
amount can be reliably estimated. Non-current provisions with a remaining term
of more than one year are recognized at the amount required to settle the
obligation, discounted to the balance sheet date.
Income Taxes and Uncertain Tax
Positions
The Proprietorship is not subject to German income taxes as it
is exempt from trade income tax as a care service provider that charges more
than 40 % of its care services to the compulsory national social security
agencies.
Revenue Recognition
The
Company recognizes revenue when the following four conditions have been met: (i)
there is persuasive evidence that an arrangement exists; (ii) delivery has
occurred or service has been rendered; (iii) the price is fixed or determinable;
and (iv) collection is reasonably assured. The Company's revenue is derived
primarily from providing health care services to residents and is recognized on
the date services are provided at amounts billable to the individual.
Fair Value Measurements and
Financial Instruments
ASC 820, Fair Value Measurements and Disclosures
(ASC 820), requires an entity to maximize the use of observable inputs and
minimize the use of unobservable inputs when measuring fair value. ASC 820
establishes a fair value hierarchy based on the level of independent, objective
evidence surrounding the inputs used to measure fair value. A financial
instruments categorization within the fair value hierarchy is based upon the
lowest level of input that is significant to the fair value measurement. ASC 820
prioritizes the inputs into three levels that may be used to measure fair
value:
Level 1
Level 1 applies to
assets or liabilities for which there are quoted prices in active markets for
identical assets or liabilities.
Level 2
Level 2 applies to
assets or liabilities for which there are inputs other than quoted prices that
are observable for the asset or liability such as quoted prices for similar
assets or liabilities in active markets; quoted prices for identical assets or
liabilities in markets with insufficient volume or infrequent transactions (less
active markets); or model-derived valuations in which significant inputs are
observable or can be derived principally from, or corroborated by, observable
market data.
- 10 -
Level 3
Level 3 applies to
assets or liabilities for which there are no observable inputs to the valuation
methodology that are relevant to the measurement of the fair value of the assets
or liabilities.
The Companys financial instruments consist principally of cash, accounts payable and advances. Pursuant to ASC 820, the fair value of cash is determined based on Level 1 inputs. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.
3. |
Intangible Assets |
Changes in intangible assets in the reporting period and in the previous year are shown in the statements of changes in fixed assets, which is attached as an appendix.
The position intangible assets only consists of software licenses.
There were no impairment write-downs to the lower value in use for the financial year as in the previous year.
4. |
Property, Plant and Equipment |
Changes in property, plant and equipment in the reporting period and in the previous year are shown in the consolidated statements of changes in fixed assets, which are attached as an appendix.
The item Land, property rights and buildings, including buildings on third-party land consists of the 50% share of flat or fractional property unit where the Administration of the sole proprietorship is registered. The whole flat or fractional property unit was acquired under Bosnian Law by the proprietor and his wife. The remaining 50% share is allotted to the operating assets of the proprietorship of the wife.
The whole flat or fractional property unit is encumbered with a mortgage property charge in an amount of EUR 110.000,00 for the loan to finance the property. The loan is repayable on maturity, so it values EUR 110.000,00 and has a remaining term until November 2018. In accordance with the allocation of half of the flat or fractional property unit, the loan is allocated to the proprietorship Das Pflegeland with 50% and has a carrying amount on the balance sheet date and in the previous year of EUR 55.000,00.
There are no other material restrictions on ownership or title in respect of the property, plant and equipment reported.
Depreciation on the lower value in use was not taken in the financial year and in the previous year.
5. |
Trade Receivables |
- 11 -
The position trade receivables includes receivables of care-services fully provided on the balance sheet date. The billing of all care-services is made on a monthly basis.
Value adjustments for trade receivables were not necessary in the financial year and the previous year.
6. |
Other Assets |
The position other assets basically consists of amounts refunded by health insurance companies and employee loans.
7. |
Cash and cash Equivalents |
The position cash and cash equivalents mainly includes short-term bank balances.
8. |
Proprietors Equity |
As of June 30, 2014 after taking into account the net profit of the year as well as capital contributions and transfer of reserves by the proprietor, the proprietors equity amounts to EUR -57.194,77 (previous year: EUR -532.311,95) . The negative proprietors equity is shown on the assets side of the balance sheet under the position claim against proprietor because of transfer from reserves due to the existing payment obligation of the proprietor.
9. |
Long-term financial Liabilities |
Non-current financial liabilities fully result from bank liabilities and include the 50% share of the loan to finance the flat or fractional property unit as well as the long-term portion of the loans to finance vehicles.
- 12 -
June 30, 2014 | Dec. 31, 2013 | ||||||
EUR | EUR | ||||||
Loan financing of the flat or fractional property unit | 55.000,00 | 55.000,00 |
The interest rate to finance flat or fractional property unit amounts to 4,8%.
10. |
Short-term financial liabilities |
The short-term financial liabilities are composed as follows:
June 30, 2014 | Dec. 31, 2013 | ||||||
EUR | EUR | ||||||
Current account liabilities to banks | 0,00 | 392.795,78 | |||||
Settlement account Premium-Pflegedienst Pflegeland | 190.095,78 | 298.302,76 | |||||
Short-term portion of the loans financing vehicles | 7.907,00 | 19.235,52 | |||||
Other short-term financial liabilities | 1.136,00 | 1.136,00 | |||||
199.138,78 | 711.470,06 |
Due to the current nature of these items, their market value does not deviate significantly from the carrying amounts presented.
11. |
Accruals |
Accruals are liabilities payable for goods or services received that are neither paid nor invoiced by the supplier on the balance sheet date. All of the reported amounts are short-term in nature.
12. |
Other liabilities |
The long-term financial liabilities are composed as follows:
- 13 -
June 30, 2014 | Dec. 31, 2013 | ||||||
EUR | EUR | ||||||
Liabilities from wages and salaries | 97.072,85 | 78.256,01 | |||||
Liabilities from income and church taxes | 17.575,99 | 9.917,96 | |||||
Liabilities resulting from social securities | 156.349,00 | 71.523,14 | |||||
Other short-term liabilities | 925,93 | 885,93 | |||||
271.923,77 | 160.583,04 |
13. |
Provisions |
The provisions fully consist of duties in connection with the preparation of the year-end financial statement of the current year.
14. |
Notes on the cash flow statement |
The cash flow statement has been prepared using the indirect method. Business transactions not affecting cash have not been included in the cash flow statement. Payments for investments in intangible assets and property, plant and equipment include only cash-effective acquisitions.
15. |
Financial instruments and risk management |
Financial instruments, which potentially expose the Company to concentrations of credit risk, consist primarily of cash and cash equivalents and accounts receivable. Cash and cash equivalents, are held with various financial institutions. These balances are maintained with high quality financial institutions which management believes limits the risk.
Details of the individual categories of financial instruments are provided in the notes on the respective balance sheet and income statement items.
Principles of the Risk Management
System
Regarding its assets, liabilities and planned transactions, the
proprietorship Das Pflegeland is subject to default risk and liquidity risk
and the risk from changes in interest rates. The aim of financial risk
management is to minimize these risks through ongoing operating and
finance-oriented activities. The proprietor is directly responsible for the
implementation of the financial policy and ongoing risk management.
Categories of Financial Instruments
The proprietorship Das Pflegeland holds financial instruments
exclusively in form of financial liabilities carried at amortized cost as well
as in form of receivables carried at amortized cost. Financial instruments
carried at fair value do not exist.
Default risk
The Company is
exposed to counterparty default risk as a result of its operating activities and
certain financing activities.
- 14 -
In its operating business, accounts receivable are monitored on a decentralized, ongoing basis. Default risks are taken into account through specific valuation allowances and flat-rate specific valuation allowances.
Liquidity risk
Revolving
liquidity planning is performed in order to ensure the Companys solvency and
financial flexibility at all times. To the extent necessary, a liquidity reserve
is held in the form of credit facilities and, if required, in cash.
Risk of changes in the interest rate
The proprietorship is subject to risks of changes in the interest rate
only to a limited extent and basically in relation to the 50 % share of the loan
for financing the flat or fractional property unit. The interest rate is
determined until November 2018.
16. |
Related parties |
Business transactions with related parties are on the one hand transactions with enterprises, which the proprietor of the proprietorship Das Pflegeland holds a significant participating share of or over which he exercises significant influence. On the other hand, these are business transactions with close members of the family of the proprietor.
In the reporting period relevant in this context are the relation to the sole proprietorship of the wife of the proprietor as well as to Medicus-Stuttgart GmbH, Stuttgart (formerly: Medicus 24 GmbH), in which the proprietor holds 100% of the shares.
Between the proprietorship Das Pflegeland and the sole proprietorship of the wife of the proprietor exists a settlement account, which shows a negative balance, i.e. a liability in the amount of EUR -190.095,78 (previous year: EUR -298.302,76) from the perspective of proprietorship Das Pflegeland. The settlement account is not subject to interest payments.
During the period under review, the proprietorship Das Pflegeland obtained services in an amount of EUR 0,00 (previous year: EUR 30.000,00) from Medicus-Stuttgart GmbH, Stuttgart (formerly: Medicus 24 GmbH).
17. |
SIGNIFICANT POST-BALANCE SHEET DATE EVENTS |
The proprietor intends to transfer the proprietorship Das Pflegeland with all assets and liabilities, rights, accounts receivables and claims as well as duties and legal relationships to the Beatmungspflege 24 in exchange for ownership in the company.
Beyond this no major changes regarding the situation of the proprietorship as well as with respect to the branch environment resulted between the balance sheet date and the date the financial statements are issued.
Stuttgart, October 31, 2014
Dr. Orhan Karahodza
- 15 -
Das Pflegeland (sole proprietorship) Appendix to the Notes
Statements of Changes in Fixed Assets
As of June 30, 2014
Land, property, | ||||||||||||
rights and | ||||||||||||
buildings, | Other | |||||||||||
including | equipment, | |||||||||||
Software | buildings on third | furnitures and | ||||||||||
licenses | party land | fixtures | Total | |||||||||
Euro | Euro | Euro | Euro | |||||||||
Acquisition and manufacturing cost: | ||||||||||||
December 31, 2012 | 934,45 | 45.665,51 | 131.457,96 | 178.057,92 | ||||||||
Additions | 0,00 | 0,00 | 559,90 | 559,90 | ||||||||
Disposals | 0,00 | 0,00 | -301,00 | -301,00 | ||||||||
December 31, 2013 | 934,45 | 45.665,51 | 131.716,86 | 178.316,82 | ||||||||
Additions | 0,00 | 0,00 | 2.778,99 | 2.778,99 | ||||||||
June 30, 2014 | 934,45 | 45.665,51 | 134.495,85 | 181.095,81 | ||||||||
Accumulated amortization and depreciation: | ||||||||||||
December 31, 2012 | 931,45 | 1.173,86 | 76.803,96 | 78.909,27 | ||||||||
Charge for the period | 0,00 | 640,00 | 14.082,90 | 14.722,90 | ||||||||
Disposals | 0,00 | 0,00 | -280,00 | -280,00 | ||||||||
December 31, 2013 | 931,45 | 1.813,86 | 90.606,86 | 93.352,17 | ||||||||
Charge for the period | 0,00 | 320,00 | 6.693,70 | 7.013,70 | ||||||||
June 30, 2014 | 931,45 | 2.133,86 | 97.300,56 | 100.365,87 | ||||||||
Residual carrying values: | ||||||||||||
As of December 31, 2013 | 3,00 | 43.851,65 | 41.110,00 | 84.964,65 | ||||||||
As of June 30, 2014 | 3,00 | 43.531,65 | 37.195,29 | 80.729,94 |