Reconciliation Statement: Qualytextil SA Brazilian GAAP to US GAAP Adjustments as of April 30, 2008

Summary

This document outlines the reconciliation of Qualytextil SA's balance sheet from Brazilian GAAP to US GAAP as of April 30, 2008. It details adjustments made to inventory, tax accruals, legal and labor-related accruals, and capital reserves to align with US accounting standards. The reconciliation ensures that financial statements meet US regulatory requirements, affecting reported inventory values, tax liabilities, and accumulated losses. The document is intended for financial reporting and compliance purposes.

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EX-10.28 7 v176896_ex10-28.htm

Exhibit 10.28
NOTES TO: QUALYTEXTIL SA - reconciliation of Brazilian GAAP to US GAAP
Balance sheet as of April 30, 2008

(a)
  
Inventory reserve
           (29,295 )
   
Inventory in transit (a-1)
  
(a-1)
       1,172,885  
   
Total adjustment to inventory
  
(a)
       1,143,590  
(b)
  
Tax accrual based on US GAAP income
  
(b)
       42,090  
(c)
  
Legal fees not accrued under Brazilian GAAP
           53,343  
   
Misc. labor accrual
           9,888  
   
Installment plan taxes not accrued - outsourcing sales contractor
           271,353  
   
Installment plan taxes not accrued - outsourcing labor contractor
           43,923  
   
Sales representative commission not accrued
           15,457  
   
Total adjustment to other debts
  
(c)
       393,964  
(d)
  
Tax accrual based on US GAAP income
           (42,090 )
   
Various accruals per  (c ) above
           (393,964 )
   
Capital reserve reversal recognized as income
           47,944  
   
Inventory reserve
           (29,295 )
   
Net adjustment to accumulated losses
  
(d)
       (417,405 )
(e)
  
Capital reserve reversal recognized as income
  
(e)
       (47,944 )
(f)
  
To reclassify as intangible assets for trademarks and tradenames
              
(g)
  
To combine debt onto one line item