- Current report filing (8-K)
March 30 2012 - 4:59PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event
reported): March 30, 2012
China Energy Recovery, Inc.
(Exact name of registrant as specified in
its charter)
Delaware
(State or other jurisdiction
of incorporation)
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000-53283
(Commission
File Number)
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33-0843696
(IRS Employer
Identification No.)
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Building#26, No. 1388 Zhangdong Road
Zhangjiang Hi-tech Park
Shanghai, China
(Address of principal executive offices)
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201203
(Zip Code)
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Registrant’s telephone number, including
area code
(86) 021 2028-1866
(Former name or former address, if changed
since last report.)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions
A.2. below):
¨
Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 4.02(a) – Non-Reliance on
Previously Issued Financial Statements or a Related Audit Report or Completed Interim Reports
On March 30, 2012, after investigation
and assessment carried out by the Company, management determined that the unaudited interim financial results for the fiscal quarters
ended March 31, 2011, June 30, 2011 and September 30, 2011, presented in the previously filed Quarterly Reports on Form 10-Q for
those fiscal periods should not be relied upon because of errors in the unaudited financial statements. The Board approved management’s
conclusion.
The correction
to the unaudited financial statements for the fiscal quarters ended March 31, 2011, June 30, 2011 and September 30, 2011, relates
to the incorrect classification of realized foreign exchange losses, resulting from purchasing activity of the Company denominated
in a currency other than the functional currency. Such losses were recorded in other comprehensive income when in fact they should
have been recorded in pre-tax income. The incorrect accounting was identified in the course of the annual closing process for the
2011 financials and corrected for purposes of the annual financials.
There were no misstatements of 2010 annual and quarterly
results and all prior years' annual and quarterly results as there was no such
business activity
similar to what caused the transaction losses in 2011.
The 2011 annual results included in the Annual Report on Form 10-K
for year ended December 31, 2011 filed by the Company on March 30, 2011 are not subject to restatement as the aforementioned matter
was identified and corrected prior to the filing of the Annual Report on Form 10-K
. The financial
information below is unaudited and reflects management’s current assessment of the errors. Until the financial statements
of the affected quarterly periods, have been finalized and re-filed there can be no assurance that the financial information below
will not be revised; therefore it should be considered preliminary and subject to change. See forward looking statements disclosure
at the end of this current report.
The incorrect classification affected exchange
gains and losses reported in net income and foreign currency translation adjustments reported in other comprehensive income. The
exchange losses were understated and the other comprehensive income relating to foreign currency translation adjustments was also
understated. The charts below reflect the adjustments that should be recorded against the figures previously disclosed in the Form
10-Q Reports, which are subject to finalization of the corrected financial statements:
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Reduction to
pre-tax income
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Accumulated
reduction to
pre-tax income
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Accumulated
income tax
effect
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Accumulated
reduction to
net income
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Unaudited interim financial results for the quarter ended March 31, 2011
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$
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120,482
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$
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120,482
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$
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(30,121
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)
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$
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90,361
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Unaudited interim financial results for the quarter ended June 30, 2011
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$
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273,709
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$
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394,191
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$
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(98,548
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)
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$
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295,643
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Unaudited interim financial results for the quarter ended September 30, 2011
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$
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434,920
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$
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829,111
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$
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(207,278
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)
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$
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621,833
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Increase to other
comprehensive income -
foreign currency
translation adjustments
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Accumulated Increase to other
comprehensive income -
foreign currency translation
adjustments
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Unaudited interim financial results for the quarter ended March 31, 2011
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$
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120,482
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$
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120,482
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Unaudited interim financial results for the quarter ended June 30, 2011
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$
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273,709
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$
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394,191
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Unaudited interim financial results for the quarter ended September 30, 2011
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$
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434,920
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$
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829,111
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The impacts on unaudited balance sheets as of March 31,
2011, June 30, 2011 and September 30, 2011 were the increase of deferred tax assets and shareholder's equity by $30,121,
$98,548 and $207,278, respectively.
The Company intends to file the revised
Form 10-Q Reports for the fiscal quarters ended March 31, June 30, and September 30, 2011 contemporaneous with the Company’s
filing of its 2012 Q1 Form 10-Q and no later than May 15, 2012.
Forward-Looking Statement Disclaimer
This report on Form 8-K includes "forward-looking statements"
within the meaning of the Securities Litigation Reform Act of 1995, as amended. All statements, other than statements of historical
fact, included in this report that address activities, events or developments that CER believes or anticipates will or may occur
in the future are forward-looking statements. These statements are based on certain assumptions made based on experience, expected
future developments and other factors that CER believes are appropriate under the circumstances. Such statements are subject to
a number of assumptions, risks and uncertainties, many of which are beyond the control of CER and may not materialize. Investors
are cautioned that any such statements are not guarantees of future performance. Actual results or developments may differ materially
from those projected in the forward-looking statements as a result of many factors. Furthermore, CER does not intend (and is not
obligated) to update publicly any forward-looking statements, except as required by law. The contents of this report should be
considered in conjunction with the warnings and cautionary statements contained in CER's filings with the Securities and Exchange
Commission.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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China Energy Recovery, Inc.
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Date: March 30, 2012
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By:
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/s/ Qinghuan Wu
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Qinghuan Wu
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Chief Executive Officer
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