Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
Board of Directors has concluded, based upon advice supplied us, previously issued financial statement(s), for which this Registrant
is required to provide financial statements under Regulation S-X (17 CFR 210) should not be relied upon. You are advised that
you should not rely upon the referenced statements and notes for the reasons below, with respect to our conclusion that Crescent
cannot be considered consolidated for accounting purposes.
statements and or notes were contained in:
Form 10-K filing for the fiscal year ended December 31, 2016, and
Form 10-Q filings for the quarterly periods ended: March 31, 2017, for the quarterly period ended June 30, 2017, for the quarterly
period ended September 30, 2017, for the quarterly period ended September 30, 2016, and for the quarterly period ended June 30,
explained herein, this conclusion regarding the non-reliance was reached on or about November 1, 2018.
discussed the subject matter with our auditing firm. As more detailed in the below section, Background, the Registrant previously
disclosed the acquisition of Crescent, and related litigation with a lender, TCA.
March 13, 2017, the Registrant, Intelligent Highway Solutions, Inc., (IHSI) confirmed the partial completion of a closing involving
a certain acquisition and certain related credit facilities, such closing referenced by the parties as the Intelligent Highway
Solutions, Inc. - Crescent Construction Company Inc. Purchase (the “Transaction”).
summary, a company acquired ownership of the acquisition, and also provided the Registrant rights to take control of the ownership
of the acquired company, and another company agreed to fund the acquisition and certain working capital, to allow the completion
of the overall Transaction.
is made to the Registrant’s Form 8-K filed in March, 2017, concerning the March 21, 2017 event of the acquisition. Reference
is also made to the Amendment filing on or about March 12, 2018, where the Registrant determined, upon advice of advisors and
in light of comments supplied the Registrant in communications with the SEC, to file an amendment.
litigation with TCA regarding Crescent continues in court, with the Registrant as the Plaintiff, in South Florida. Unfortunately,
TCA has not filed an Answer to the claims as of this date, and it is believed TCA continues to assert that it owns and or controls
Crescent and or assets of Crescent.
records of Crescent, otherwise needed for such things as completing financial statements, completing audits, among other things,
remain in limbo given the lack of settlement with TCA and lack of court order to the contrary. The Registrant believes it owns
and controls Cresent but in light of litigation and lack of cooperation from TCA it is unable to complete or control Cresent as