This excerpt taken from the RICK 8-K filed Feb 11, 2008.
The combined financial statements include the accounts of Miami Gardens Square One, Inc. and Stellar Management Corporation. Significant intercompany accounts and transactions have been eliminated in combination.
Basis of Accounting
The accounts are maintained and the financial statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts in the financial statements and accompanying notes. Actual results could differ from these estimates and assumptions.
Cash and Cash Equivalents
The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. At September 30, 2007 and December 31, 2006, the Company had no such investments. The Company maintains deposits primarily in one financial institution, which may at times exceed amounts covered by insurance provided by the U.S. Federal Deposit Insurance Corporation (“FDIC”). At September 30, 2007 and December 31, 2006, the uninsured portion of these deposits approximated $386,000 and $371,000, respectively. The Company has not incurred any losses related to its cash on deposit with financial institutions.
Accounts receivable, trade is comprised of credit card charges, which are generally converted to cash in two to five days after a purchase is made. The Company recognizes allowances for doubtful accounts when, based on management judgment, circumstances indicate that accounts receivable will not be collected. There was no allowance for doubtful accounts as of September 30, 2007 and December 31, 2006.
MIAMI GARDENS SQUARE ONE, INC. AND STELLAR MANAGEMENT CORPORATION
Notes to Combined Financial Statements
Inventories include non-alcoholic beverages, bar supplies, and Company merchandise. Inventories are carried at the lower of average cost, which approximates actual cost determined on a first-in, first-out (“FIFO”) basis, or market.
Property and Equipment