Changes have no affect on cash position, business operations, or project backlog
New York, New York--(Newsfile Corp. - April 19, 2021) - UGE International Ltd. (TSXV: UGE) (the "Company" or "UGE") announces it will restate and refile its interim financial statements and management's discussion and analysis ("MD&A") for the three and six months ended June 30, 2020 and for the three and nine months ended September 30, 2020 (collectively, the "Restated Documents").
As part of a review of its financial statements in connection with 2020 year-end activities, the Company determined that its originally issued interim financial statements for the above mentioned time periods contained the following material accounting errors:
- the accounting for revenue and cost of goods sold for certain transactions contained computational errors, resulting in an overstatement of gross profit of approximately $230,000 in the three months ended June 30, 2020 and an overstatement of approximately $225,000 in the three months ended September 30, 2020;
- the accounting for certain transactions and costs associated with the development and construction of Solar Assets contained computational errors, resulting in a net overstatement of Solar Assets and Construction in Progress of approximately $382,000 at September 30, 2020;
- certain costs associated with the development of Solar Assets that UGE intends to own and operate were incorrectly expensed rather than capitalized as required under IFRS resulting in an understatement of intangible assets of approximately $117,000 at September 30, 2020; and
- right-of-use assets and lease liabilities for certain lease contracts were not recognized as required by IFRS 16, resulting in a net understatement of both right-of-use assets and lease liabilities of approximately $1,300,000 at September 30, 2020. These right-of-use assets and lease liabilities are not current assets or liabilities and reflect the value of long-term contracts for Solar Assets.
The changes noted above had no effect on the Company's cash position, business operations, or the economics of any of the Company's commercial arrangements.
"In the past year we have experienced tremendous growth and maturation as a company," said UGE's CEO, Nick Blitterswyk. "I would like to thank our finance team for their hard work on our 2020 year-end audit, during which these necessary changes were identified from earlier in the year."
The Company intends to file its Restated Documents as soon as possible, in line with the release of its 2020 audited annual financial statements and MD&A for the three and twelve months ended December 31, 2020, which are expected to be filed by April 30, 2021. Taking into account, among other things, the time required for management to complete its analysis, as well as the need for the Company's auditors to complete their audit work, the Company cannot assure that the intended timing of filing will be met. The Restated Documents will replace and supersede the respective previously filed interim financial statements and MD&As for such periods. The previously filed interim financial statements and MD&As should no longer be relied on.
About UGE
UGE develops, owns, and operates commercial and community solar projects in the US and strategic markets abroad. Our distributed energy solutions deliver cheaper, cleaner energy to businesses and consumers with no upfront cost. With over 400MW of global experience, we work daily to power a more sustainable world. Visit us at www.ugei.com.
For more information, contact UGE at:
+1 917 720 5685
investors@ugei.com
Forward-Looking Statements
Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties, certain of which are beyond the control of the Company. Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Forward-looking statements include, but are not limited to, the anticipated timing of the filing of the Restated Documents. The Company assumes no obligation to update forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
Neither the TSX Venture Exchange nor its Market Regulator (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/80793.
