As reflected in the accompanying consolidated financial statements, the Company has incurred losses from operations for the year ended December 31, 2008 of $4.1 million. In addition, negative current economic conditions and other factors have led to a reduction in the number of active RTAs in the Company. The number of active IBC sites has declined during the year ended December 31, 2008 by a net of 39,419 sites to 92,383 active RTA IBCs from the 131,802 reported as of December 31, 2007. The Company is also defending against two cases challenging the legality of its network marketing program. The litigation claims can be expensive and time consuming to bring and defend against and could result in settlements or damages that could significantly affect financial results. The Company’s loss from operations, the declining active IBC count, working capital deficiency, uncertainties surrounding the Company’s pending litigation and the general downturn in the economy raise substantial doubt about the Company’s ability to continue as a going concern.
- 2008 losses $4.1 Million
- 2009 losses $9.8 Million
- 2008 RTAs lost 29.91%
- 2009 RTAs lost 55.43%
- 2008 Company defending against two legal challenges (California and Class Action)
- 2009 Company defending against two legal challenges (Illinois and Class Action)
Seems to me like the auditor may have had his arm twisted a little bit and bought into the rhetoric that ZamZuu is something new and unique. After all, the perks of ZamZuu can be had in any number of online shopping portals--just not the girdles--they are exclusive to YTB since Ghiada is owned by Jerome and Melissa!