via EY - Bankruptcies, Liquidations and Quasi-Reorganizations

The following paper has an excellent discussion of quasi-reorganizations, their comparison between measures carried under GAAP and IFRS, and a complicated balance sheet example. The discussion contains legal requirements under the SEC, which would let you in on exactly what the company would follow, should they emerge as quasico. If the company intends to list on U.S. exchanges or has U.S. investors, then the proceedings would have to be perfected to a fault before presentation to Amerucan investors.

We are in the last quarter of the taxation year, and under Canadian law, the end of the fiscal year must default to the end of the calendar year, as opposed to the end of April. That means the project, which had its operations prepaid for a years' operations, must see its emegence in the fourth quarter.

"8.5.2 SEC reporting in a quasi-reorganization In advance of completing a quasi-reorganization, a registrant might need to seek the approval of its shareholders, which might require filing proxy statements. The SEC staff has asked registrants to disclose the following:

• Reasons the quasi-reorganization would be in the best interest of the registrant and its stockholders (e.g., reasons why the quasi-reorganization will mitigate prior issues faced by the registrant and the benefits that will result from this quasi-reorganization)

• Expected effects that a quasi-reorganization could have on future periods

• Reasons the registrant expects to be profitable in future periods In addition, pro forma financial information reflecting quasi-reorganization accounting may be required in a Form 8-K, SEC registration statements and proxy statements.

Article 11 requires registrants to provide pro forma financial information if material events or transactions have occurred or are probable of occurring and if disclosure of pro forma financial information would be material to investors, which could include a quasi-reorganization. Although pro forma financial statements are not specifically required for smaller reporting companies in this situation, smaller reporting companies should consider providing pro forma financial statements if the information is considered material to investors. Pro forma financial information prepared in accordance with Article 11 generally includes a condensed income statement for the latest year and any subsequent interim period, a condensed balance sheet as of the end of the latest period presented, and accompanying explanatory notes. "

http://www.ey.com/publication/vwluassetsdld/financialreportingdevelopments_bb1840_bankruptcy_19july2016/$file/financialreportingdevelopments_bb1840_bankruptcy_19july2016.pdf?OpenElement

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