-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DAOXuFzOFtgAlG6bCI54QTS8j481V5i744WGi3CsJTOIun6XQ3P+SY4LAXAjHtUL XVkwVENBKz18VBST4G9glA== 0001015402-01-503791.txt : 20020412 0001015402-01-503791.hdr.sgml : 20020412 ACCESSION NUMBER: 0001015402-01-503791 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20011001 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20011212 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GAMA COMPUTER CORP CENTRAL INDEX KEY: 0001126577 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370] IRS NUMBER: 980125787 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-31008 FILM NUMBER: 1811653 BUSINESS ADDRESS: STREET 1: BLVD HIDALGO 67 ENTRE CAMPODONICO Y LOND STREET 2: COL CENTENARIO HERMOSILLO SONORA CITY: MEXICO CP STATE: A1 ZIP: 83260 BUSINESS PHONE: 0115262171 MAIL ADDRESS: STREET 1: 309-837 WEST HASTINGS STREET STREET 2: VANCOUVER BRITISH COLUBIA CITY: CANADA V6C 3N6 STATE: A1 ZIP: 00000 8-K/A 1 doc1.txt SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K/A AMENDMENT TO CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): October 1, 2001 THE BLUEBOOK INTERNATIONAL HOLDING COMPANY ------------------------------------------------------ (Exact Name of Registrant as Specified in Its Charter) DELAWARE 0-31008 98-0125787 - -------------------------- ------------------------ -------------------------- (State or Other (Commission File Number) (I.R.S. Employee Jurisdiction of Incorporation) Identification Number) 21098 Bake Parkway, Suite 100, Lake Forest, California 92630-2163 ----------------------------------------------------------------- (Address of Principal Executive Offices, Including Zip Code) (714) 731-3389 ------------------------------------------------------ (Registrant's Telephone Number, Including Area Code) ------ THE BLUEBOOK INTERNATIONAL HOLDING COMPANY FORM 8-K/A General: This report on Form 8-K/A provides financial statements and exhibits - ------- required pursuant to Item 7, parts (a) and (b) of Form 8-K resulting from the acquisition of The Bluebook International, Inc. by The Bluebook International Holding Company (formerly known as Gama Computer Corporation) (the "Company"). Information required pursuant to Item 1, Changes in Control of Registrant; Item 2, Acquisition or Disposition of Assets; and Item 7, part (c), Exhibits, is included in Form 8-K filed by the Company on October 16, 2001. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits - ------- (a) Financial Statements of Business Acquired Financial Statements of The Bluebook International, Inc. as of the year ended December 31, 2000 (audited) and the six month period ended June 30, 20001 (unaudited) are included herein. As of September 15, 2001, The Bluebook International, Inc. acquired all of the assets of Bluebook, a sole proprietorship, and therefore, Financial Statements of Bluebook, a sole proprietorship, as of the year ended December 31, 2000 (audited) and the six month period ended June 30, 20001 (unaudited) are also included herein. (b) Pro Forma Financial Information Consolidated Financial Statements of the Company, The Bluebook International, Inc. and Bluebook, a sole proprietorship, as of the year ended December 31, 2000 (audited) and the nine-month period ended September 30, 2001 (unaudited), were included in the Form 10-QSB filed by the Company on November 19, 2001, and are hereby incorporated herein by this reference. BLUEBOOK INTERNATIONAL, INC. (A DEVELOPMENT STAGE COMPANY) FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND PERIOD FROM INCEPTION DECEMBER 5 TO DECEMBER 31, 2000 BLUEBOOK INTERNATIONAL, INC. (A DEVELOPMENT STAGE COMPANY) SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND PERIOD FROM INCEPTION DECEMBER 5 TO DECEMBER 31, 2000 CONTENTS PAGE INDEPENDENT AUDITORS' REPORT 1 FINANCIAL STATEMENTS Balance sheets 2 Statements of income 3 Statement of stockholders' equity 4 Statements of cash flows 5 Notes to financial statements 6-9 INDEPENDENT AUDITORS' REPORT Board of Directors Bluebook International, Inc. (A Development Stage Company) Lake Forest, California We have audited the accompanying balance sheet of Bluebook International, Inc. (a development stage company) as of December 31, 2000 and the related statements of income, stockholders' equity and cash flows for the period from inception December 5 to December 31, 2000. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Bluebook International, Inc. (a development stage company) as of December 31, 2000, and the results of its operations, stockholders' equity and its cash flows for the period from inception December 5 to December 31, 2000 in conformity with accounting principles generally accepted in the United States of America. Los Angeles, California September 17, 2001 1
BLUEBOOK INTERNATIONAL, INC (A DEVELOPMENT STAGE COMPANY) BALANCE SHEETS JUNE 30, 2001 (UNAUDITED) AND DECEMBER 31, 2000 June 30, 2001 December 31, 2000 --------------- ------------------ (unaudited) ASSETS Current assets Cash and cash equivalent $ 104,276 $ 102,335 --------------- ------------------ Total current assets 104,276 102,335 --------------- ------------------ $ 104,276 $ 102,335 =============== ================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Due to stockholders $ 20,000 $ 20,000 Income tax payable 1,440 1,150 --------------- ------------------ Total current liabilities 21,440 21,150 Stockholders' equity Preferred stock, Series A Convertible, par value $0.01, - - authorized 1,250,000 shares, no shares issued and outstanding Preferred stock, Series B Convertible, par value $0.01, - - authorized 3,750,000 shares, no shares issued and outstanding Common stock, par value $0.01, authorized 45,000,000 shares - - issued and outstanding 7,083,332 shares 70,833 70,833 Additional paid in capital 9,167 9,167 Retained earnings, accumulated during development stage 2,836 1,185 --------------- ------------------ 82,836 81,185 --------------- ------------------ $ 104,276 $ 102,335 =============== ==================
See accompaning Notes to Financial Statements 2
BLUEBOOK INTERNATIONAL, INC (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF INCOME JUNE 30, 2001 (UNAUDITED) AND DECEMBER 31, 2000 Cummulative For the period from For the period from For the six months inception inception ended December 5 to December 5 to June 30, 2001 June 30, 2001 December 31, 2000 --------------- --------------- ------------------ (unaudited) (unaudited) Interest income $ 1,941 $ 4,276 $ 2,335 Income tax expense 290 1,440 1,150 --------------- --------------- ------------------ Net Income $ 1,651 $ 2,836 $ 1,185 =============== =============== ==================
See accompaning Notes to Financial Statements 3
BLUEBOOK INTERNATIONAL, INC (A DEVELOPMENT STAGE COMPANY) STATEMENT OF STOCKHOLDERS' EQUITY JUNE 30, 2001 (UNAUDITED) AND DECEMBER 31, 2000 COMMON STOCK ------------------ SHARES ADDITIONAL RETAINED ISSUED AMOUNT PAID IN CAPITAL EARNINGS TOTAL --------- ------- ---------------- --------- ------- Issuance of stock, December 5, 2000 7,083,332 $70,833 $ 9,167 $ - $80,000 Net income, inception December 5 to December 31, 2000 1,185 1,185 Balance, December 31, 2000 7,083,332 70,833 9,167 1,185 81,185 Net income, six months 1,651 1,651 --------- ------- ---------------- --------- ------- Balance, June 30, 2001 (unaudited) 7,083,332 $70,833 $ 9,167 $ 2,836 $82,836 ========= ======= ================ ========= =======
See accompaning Notes to Financial Statements 4
BLUEBOOK INTERNATIONAL, INC (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF CASH FLOWS JUNE 30, 2001 (UNAUDITED) AND DECEMBER 31, 2000 Cummulative For the period For the period For the six months from inception from inception ended December 5 to December 5 to June 30, 2001 June 30, 2001 December 31, 2000 --------------- --------------- ------------------ (unaudited) (unaudited) CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 1,651 $ 2,836 $ 1,185 Adjustments to reconcile net income to net cash provided by operating activities: Changes in operating assets and liabilities: Income taxes payable 290 1,440 1,150 --------------- --------------- ------------------ Net cash provided by operating activities 1,941 4,276 2,335 CASH FLOWS FROM INVESTING ACTIVITIES - - - CASH FLOWS FROM FINANCING ACTIVITIES Loan from stockholders - 20,000 20,000 Proceeds from issuance of stocks - 80,000 80,000 --------------- --------------- ------------------ Net cash provided from financing activities - 100,000 100,000 NET CHANGE IN CASH AND CASH EQUIVALENT 1,941 104,276 102,335 CASH AND CASH EQUIVALENT, BEGINNING OF YEAR 102,335 - - --------------- --------------- ------------------ CASH AND CASH EQUIVALENT, END OF YEAR $ 104,276 $ 104,276 $ 102,335 =============== =============== ================== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Income taxes paid $ - $ - $ - =============== =============== ==================
See accompaning Notes to Financial Statements 5 BLUEBOOK INTERNATIONAL, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND PERIOD FROM INCEPTION DECEMBER 5 TO DECEMBER 31, 2000 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY Basis of presentation Bluebook International, Inc., (the "Company") was incorporated on December 5, 2000 under the laws of the State of Nevada. On September 15, 2001, the Company purchased 100% of the assets and business of Bluebook, a sole proprietorship, which has been in the business of developing and selling its manuals, The Bluebook of Cleaning, Reconstruction and Repair Cost ("The Bluebook") and Bluebook Estimating Software Technology ("B.E.S.T.") for over 37 years. The interim financial statements presented, have been prepared by the Company without audit and, in the opinion of the management, reflect all adjustments of a normal recurring nature necessary for a fair statement of (a) the results of operations for the period from December 5, to June 30, 2001, (b) the financial position at June 30, 2001 and (c) the cash flows for the six months ended June 30, 2001 and for the period from December 5, 2000 to June 30, 2001. Interim results are not necessarily indicative of results for a full year. Business activity Until September 15, 2001, the Company was in a development stage. After September 15, 2001, the principal business of the Company is developing and selling its manuals, The Bluebook and B.E.S.T. The Bluebook is a book in the form of both a desk and pocket size book containing the average unit costs attendant to the cleaning, reconstruction and repair industries. B.E.S.T. is a software format of The Bluebook which allows subscribers the option to retrieve The Bluebook data and calculate the cost to clean, reconstruct or repair, and then file claims electronically. Currently the Company is developing B.E.S.T. Net (TM), a web-based cost estimation and claims management software. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Cash equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. 6 BLUEBOOK INTERNATIONAL, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND PERIOD FROM INCEPTION DECEMBER 5 TO DECEMBER 31, 2000 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY -CONTINUED Fair value of financial instruments The fair value of the Company's financial instruments approximates the carrying value of the instruments. Income taxes The Company utilizes the asset and liability method for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. 2. CERTAIN SIGNIFICANT RISKS AND UNCERTAINTIES Dependency on key management The future success or failure of the Company is dependent primarily upon the efforts of Daniel T. Josipovich and Mark A. Josipovich, two of the Company's principal founders. The Company does not have insurance covering such officers' partial or total liability. The Company has entered into employment contracts with the key officers of the Company to ensure their employment over five years. Concentration of credit risk The Company maintains its checking and time deposit accounts with financial institutions with high credit ratings. At times the balance may exceed federally insured limits of $100,000. 3. DUE TO STOCKHOLDERS Due to stockholders represents a $20,000 non-interest bearing loan from the stockholders. This loan is payable on demand. 7 BLUEBOOK INTERNATIONAL, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND PERIOD FROM INCEPTION DECEMBER 5 TO DECEMBER 31, 2000 4. INCOME TAXES For the period ended December 31, 2000, the provision for income tax expense consists of the following: Current: Federal $ 350 State 800 -------- $ 1,150 ======== 5. SUBSEQUENT EVENT On September 15, 2001, the Company acquired 100% of the assets and business of Bluebook, a sole proprietorship, for $1,000,000 and assumption of owner's liability up to $300,000. The majority stockholder of the Company was the owner of the sole proprietorship. Had the acquisition taken place as of June 30, 2001, the consolidated balance sheet would be as follows: 8
BLUEBOOK INTERNATIONAL, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND PERIOD FROM INCEPTION DECEMBER 5 TO DECEMBER 31, 2000 June 30, 2001 (unaudited) --------------------------------------------------------------------- BB International BB Sole Proprietor Adjustments Consolidated ----------------- -------------------- ------------- ------------- ASSETS CURRENT ASSETS Cash and cash equivalent $ 104,276 $ 52,172 $ - $ 156,448 Inventory - 29,325 - 29,325 ----------------- -------------------- ------------- ------------- TOTAL CURRENT ASSETS 104,276 81,497 - 185,773 PURCHASED INTANGIBLES - - 1,254,790 1,254,790 PROPERTY AND EQUIPMENT, net - 62,644 - 62,644 PROGRAM DEVELOPMENT COSTS, net - 169,703 - 169,703 ----------------- -------------------- ------------- ------------- TOTAL $ 104,276 $ 313,844 $ 1,254,790 $ 1,672,910 ================= ==================== ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Due to stockholders $ 20,000 $ - $ 1,000,000 $ 1,020,000 Accounts payable and accrued expenses 7,567 245,039 252,606 Income tax payable 1,440 1,440 ----------------- -------------------- ------------- ------------- TOTAL CURRENT LIABILITIES 21,440 7,567 1,245,039 1,274,046 DEFERRED REVENUE - 316,028 - 316,028 STOCKHOLDERS' EQUITY Preferred stock, Series A, par value $0.01 authorized 1,250,000 shares, issued and outstanding nil. - - Preferred stock, Series B, par value $0.01 authorized 3,750,000 shares, issued and outstanding nil. - - Common stock, par value $0.01, authorized - - 25,000,000 shares issued and outstanding 7,083,332 shares 70,833 70,833 Additional paid in capital 9,167 9,167 Owners' equity - (169,816) 169,816 - Current year net income 2,836 160,065 (160,065) 2,836 ----------------- -------------------- ------------- ------------- TOTAL STOCKHOLDERS' EQUITY 84,276 (9,751) 9,751 84,276 ----------------- -------------------- ------------- ------------- TOTAL $ 104,276 $ 313,844 $ 1,254,790 $ 1,672,910 ================= ==================== ============= =============
9 BLUEBOOK, (A SOLE PROPRIETORSHIP) FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 BLUEBOOK, (A SOLE PROPRIETORSHIP) SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 CONTENTS PAGE INDEPENDENT AUDITORS' REPORT 1 FINANCIAL STATEMENTS Balance sheets 2 Statements of income and owner's equity 3 Statements of cash flows 4 Notes to financial statements 5-10 INDEPENDENT AUDITORS' REPORT Board of Directors Bluebook, (a sole proprietorship) Lake Forest, California We have audited the accompanying balance sheet of Bluebook, (a sole proprietorship) as of December 31, 2000 and the related statement of income and owner's equity, and cash flows for the year ended December 31, 2000. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above presents fairly, in all material respects, the financial position of Bluebook, (a sole proprietorship) as of December 31, 2000, and the results of its operations and its cash flows for the year ended December 31, 2000 in conformity with accounting principles generally accepted in the United States of America. Los Angeles, California September 17, 2001 1
BLUEBOOK, (A SOLE PROPRIETORSHIP) BALANCE SHEETS JUNE 30, 2001 (UNAUDITED) AND DECEMBER 31, 2000 JUNE 30, DECEMBER 31, 2001 2000 ----------- ------------ (UNAUDITED) ASSETS CURRENT ASSETS CASH AND CASH EQUIVALENT $ 52,172 $ 83,097 INVENTORY 29,325 - ----------- ------------ TOTAL CURRENT ASSETS 81,497 83,097 PROPERTY AND EQUIPMENT, NET OF ACCUMULATED DEPRECIATION 62,644 71,509 PROGRAM DEVELOPMENT COSTS, NET OF ACCUMULATED AMORTIZATION 169,703 181,032 ----------- ------------ $ 313,844 $ 335,638 =========== ============ LIABILITIES AND OWNER'S EQUITY CURRENT LIABILITIES ACCOUNTS PAYABLE AND ACCRUED EXPENSES $ 7,567 $ 6,421 ----------- ------------ TOTAL CURRENT LIABILITIES 7,567 6,421 DEFERRED REVENUE 316,028 400,613 OWNER'S EQUITY (9,751) (71,396) ----------- ------------ $ 313,844 $ 335,638 =========== ============
See accompaning Notes to Financial Statements 2
BLUEBOOK, (A SOLE PROPRIETORSHIP) STATEMENTS OF INCOME AND OWNER'S EQUITY SIX MONTHS ENDED JUNE 30, 2001 (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 SIX MONTHS FOR THE YEAR ENDED ENDED JUNE 30, DECEMBER 31, 2001 2000 ------------ -------------- (UNAUDITED) SALES, NET $ 431,928 $ 644,450 OPERATING EXPENSES SELLING, GENERAL AND ADMINISTRATIVE EXPENSE 244,102 441,425 DEPRECIATION AND AMORTIZATION EXPENSE 29,700 55,612 ------------ -------------- 273,802 497,037 OTHER INCOME 1,941 1,819 ------------ -------------- NET INCOME 160,067 149,232 ------------ -------------- OWNER'S EQUITY, BEGINNING OF YEAR (PERIOD) (71,396) (116,609) DRAWING FOR THE YEAR (PERIOD) (118,438) (411,760) ADDITIONAL CAPITAL CONTRIBUTED 20,016 307,741 ------------ -------------- OWNER'S EQUITY, END OF YEAR (PERIOD) $ (9,751) $ (71,396) ============ ==============
See accompaning Notes to Financial Statements 3
BLUEBOOK, (A SOLE PROPRIETORSHIP) STATEMENTS OF CASH FLOWS SIX MONTHS ENDED JUNE 30, 2001 (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 SIX MONTHS FOR THE YEAR ENDED ENDED JUNE 30, DECEMBER 31, 2001 2000 ------------ -------------- (UNAUDITED) CASH FLOWS FROM OPERATING ACTIVITIES NET INCOME $ 160,067 $ 149,232 ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES: DEPRECIATION AND AMORTIZATION 29,700 55,612 CHANGES IN OPERATING ASSETS AND LIABILITIES: INVENTORY (29,325) - ACCOUNTS PAYABLE AND ACCRUED EXPENSES 1,146 (968) DEFERRED REVENUE (84,584) (60,602) ------------ -------------- NET CASH PROVIDED BY OPERATING ACTIVITIES 77,004 143,274 ------------ -------------- CASH FLOWS FROM INVESTING ACTIVITIES PURCHASE OF PROPERTY AND EQUIPMENT (2,070) (39,985) PROGRAM DEVELOPMENT COSTS (7,437) (35,542) ------------ -------------- NET CASH USED IN INVESTING ACTIVITIES (9,507) (75,527) ------------ -------------- CASH FLOWS FROM FINANCING ACTIVITIES OWNER'S WITHDRAWAL (118,438) (411,760) OWNER'S CAPITAL CONTRIBUTION 20,016 307,741 ------------ -------------- NET CASH USED IN FINANCING ACTIVITIES (98,422) (104,019) ------------ -------------- NET DEREASE IN CASH AND CASH EQUIVALENTS (30,925) (36,272) CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR (PERIOD) 83,097 119,369 ------------ -------------- CASH AND CASH EQUIVALENTS, END OF YEAR (PERIOD) $ 52,172 $ 83,097 ============ ==============
See accompaning Notes to Financial Statements 4 BLUEBOOK, (A SOLE PROPRIETORSHIP) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY Basis of presentation Bluebook, (the "Company") is a sole proprietorship which has been in the business of developing and selling its manuals, The Bluebook of Cleaning, Reconstruction and Repair Cost ("The Bluebook") and Bluebook Estimating Software Technology ("B.E.S.T."). for over 37 years. The financial statements have been prepared solely from the accounts of Bluebook and do not include the personal accounts of the owner or those of any other operation in which he is engaged. The interim financial statements presented, have been prepared by the Company without audit and, in the opinion of the management, reflect all adjustments of a normal recurring nature necessary for a fair statement of (a) the results of operations for the six months ended June 30, 2001, (b) the financial position at June 30, 2001 and (c) the cash flows for the six months ended June 30, 2001. Interim results are not necessarily indicative of results for a full year. Business activity The principal business of the Company is developing and selling its manuals, The Bluebook and B.E.S.T The Bluebook is a book in the form of both a desk and pocket size book containing the average unit costs attendant to the cleaning, reconstruction and repair industries. B.E.S.T. is a software format of The Bluebook which allows subscribers the option to retrieve The Bluebook data and calculate the cost to clean, reconstruct or repair, and then file claims electronically. Currently the Company is developing B.E.S.T. Net (TM), a web-based cost estimation and claims management software. On September 15, 2001, the Company's assets and business was acquired by The Bluebook International Inc., a related party. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. 5 BLUEBOOK, (A SOLE PROPRIETORSHIP) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY -CONTINUED Cash equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Fair value of financial instruments The fair value of the Company's financial instruments approximates the carrying value of the instruments. Inventories Inventories which consist of The Bluebook and B.E.S.T., are stated at the lower of cost (first-in, first-out) or fair value. Property and equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method of depreciation over estimated useful lives ranging from 3 to 7 years. Patents and trademarks Patent and trademark application costs are expensed as incurred. Advertising costs Advertising costs, except for costs associated with direct-response advertising, are charged to operations when incurred. The costs of direct-response advertising are deferred and amortized over the period during which future benefits are expected to be received. Revenue recognition Sales of The Bluebook Revenues from sales of The Bluebook are recognized when delivery has occurred and significant risks and rewards of ownership have transferred to the buyer, provided that the price is fixed or determinable and ultimate collection is reasonably assured. 6 BLUEBOOK, (A SOLE PROPRIETORSHIP) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY -CONTINUED Revenue recognition - Continued Subscription-based products Revenues from sales of subscription-based products are primarily recognized ratably over the terms of the subscriptions. Subscription revenue received or receivable in advance of the delivery of services is included in deferred revenue. Incremental costs that are directly related to the subscription revenue, if material, are deferred and amortized over the subscription period. Software-related products and services Revenues from software-related products are recognized when the following four criteria are met: - Persuasive evidence of an arrangement exists; - Delivery has occurred or services have been rendered; - The fee or sales price is fixed or determinable; and - Collectibility is reasonably assured. If the above criteria are met, the revenue generally is recognized ratably on a straight-line basis over the remaining useful-life of the software. Certain contracts specify separate fees for the software and the ongoing fees for maintenance and other support. If sufficient verifiable objective evidence of the fair value of each element of the arrangement exists, the elements of the contract are unbundled and the revenue for each element is recognized as appropriate. Computer software to be sold, leased, or otherwise marketed Statement of Financial Accounting Standard No. 86 (SFAS No. 86), "Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed", applies to costs of both internally developed and purchased software. The capitalization of computer software begins upon the establishment of technological feasibility of the product, which the Company has defined as the completion of beta testing of a working product. Costs of purchased computer software that has no alternative future use will be accounted for in the same manner as the costs incurred to internally develop such software. Costs of purchased computer software that has an alternative future use will be capitalized and accounted for in accordance with its use. 7 BLUEBOOK, (A SOLE PROPRIETORSHIP) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY -CONTINUED Computer software to be sold, leased, or otherwise marketed - continued Costs of producing a product master incurred after establishing technological feasibility will be capitalized. Costs of maintenance, such as costs for error corrections and additions to keep the product updated, and customer support will be charged to operations. Costs incurred for duplicating the software, documenting and obtaining training materials from the product masters, and for physically packaging the product for distribution should be capitalized as inventory. The capitalized computer software costs are amortized on the straight-line method over the estimated economic life of the product, two years. 2. CONCENTRATION OF CREDIT RISK The Company maintains its checking and time deposit accounts with financial institutions with high credit ratings. At times the balance may exceed federally insured limits of $100,000. 3. PROPERTY AND EQUIPMENT At June 30, 2001 and December 31, 2000, property and equipment consist of the following: June 30, 2001 December 31, (Unaudited) 2000 ------------- ------------ Furniture $ 10,620 $ 10,620 Software 20,035 19,074 Office equipment 86,851 85,743 ------------- ------------ 117,506 115,437 Less accumulated depreciation 54,862 43,928 ------------- ------------ $ 62,644 $ 71,509 ============ =========== 8 BLUEBOOK, (A SOLE PROPRIETORSHIP) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 4. PROGRAM DEVELOPMENT COSTS At June 30, 2001 and December 31, 2000, program development costs consist of the following: June 30, 2001 December 31, (Unaudited) 2000 ------------- -------------- Program development costs $ 263,510 $ 256,074 Less accumulated amortization 93,807 75,042 ------------- -------------- $ 169,703 $ 181,032 ============= ============== 5. INCOME TAXES The Company is a sole proprietorship; therefore, profits and losses are reportable by the owner on his respective income tax returns. Accordingly, no provision for income taxes has been reflected in these financial statements. 6. RELATED PARTY TRANSACTIONS The Company rents its office from a stockholder on a monthly basis for $800 per month. 7. COMMITMENTS AND CONTINGENCIES Operating leases The Company leases certain equipment and vehicles which are accounted for as non-cancelable operating leases. Future minimum lease payments on leases with initial or remaining term in excess of one year as of December 31, 2000 are as follows: 2001 $10,451 2002 10,451 2003 8,554 2004 6,803 thereafter 819 -------- $37,078 -------- 9 BLUEBOOK, (A SOLE PROPRIETORSHIP) NOTES TO FINANCIAL STATEMENTS SIX MONTHS ENDED JUNE 30, 2001, (UNAUDITED) AND YEAR ENDED DECEMBER 31, 2000 8. SUBSEQUENT EVENT On September 15, 2001, all the assets and the business of the Company were acquired by The Bluebook International, a related party company, for $1,000,000 and assumption of owner's liability up to $300,000. 10 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Amendment to Current Report to be signed on its behalf by the undersigned hereunto duly authorized. THE BLUEBOOK INTERNATIONAL HOLDING COMPANY Date: December 6, 2001 By: /s/ Mark A. Josipovich ------------------------------------------- Mark A. Josipovich, Chief Executive Officer -----END PRIVACY-ENHANCED MESSAGE-----