We wish to encourage two way contact with our many readers. In particular we seek assistance in exposing the state led Feltex IPO scandal. Our form system has changed. We look forward to hearing from you and will reply to apparently sincere correspondents. Click here!

To our page bach through previous editions click here

And to view our evidence that the Feltex IPO was instigated by the major political parties to rob investors to cheat Olympic medals click here

September 2013 Edition

Justaccounting deplores the appointment of Australian Julie Read as Chief Executive of NZ’s Serious Fraud Office. This appointment (appropriately made 11 September 2013, disaster day) follows crooked appointments of Australian females Jane Diplock and Keitha Dunstan to NZ’s Securities Commission around 2002 to allow the country’s commerce system to go to rack and ruin in the interest of crookedly gaining gold and silver Olympic medals.

We say a full 1 lb of brain matter is needed in this job, not 14 oz, but if there is a need to honour females it should be a NZ one not imports from across the ditch. Australia seldom has females in such positions and we don’t want them coming here in their attempt at stardom. Their female prime ministers lasted just 3 years, not 10 like here or 12 in Britain (Canada escaped with 4 months and is rich) and as in all 3 countries there are no more females waiting in contention for the PM job. Much of the reason for this Aussie female executive invasion is of course NZ males have gone over there to work and to try to escape maintenance payments having been shut out of their family by the oppressive female regime here, and hence vote there and not here. Australian females might be peeved but it is not a solution for them to come here just as they don’t want boat people going their country.

The SFO has ignored the Feltex IPO mega crime and we believe Ms Read is promising to keep it that way. We present again the very simple essence of that crime.

The following is an extract from page 37 of the 2004 Feltex Carpets IPO prospectus which the SFO, former Securities Commission, and FMA amongst many other public agencies and officials are “somehow” not able to see.

It is immediately obvious that 11 years of figures are contained in this graph and are referred to in the narration above it. It is normal to use 10 years of figures as is referred to elsewhere in the prospectus. Using the round figure of 10 as a convention reduces the chance of the number being chosen to give the “best” result for some purpose. 1993 was a low year, the lowest at least since 1989.

The accepted way to average the trend of such a set of results is of course by way of least squares regression analysis which takes each year’s size into account. This method has not been employed to get the 1.7% compound growth claimed. Only the years 1993 and 2003 were used in this calculation since growing the 1993 figure for 10 years at 1.7% p.a. compounding growth gives the 2003 figure ie +44687*(1.017)^10 = 53105. 1993 is the least relevant of the years shown so why should it be given such high importance? The answer is “to mislead”. Using the regression analysis on all 10 figures 1994 to 2003 we get a line showing 0.39% of average growth. This line gives a prediction for the 2005 market size of 51,658,000 square meters which is 3% below the actual figure for the year 2003. However on page 91 Feltex claim that the increase in its revenue due to increased market size which it adopted for its projections of its 2005 performance, being a 2% increase on that for 2003, is below the average growth over the past 10 years. This is the text it used for the assumption “ The size of the carpet market in New Zealand and Australia, measured by volume of linear metres sold, will grow over the projected period by approximately 1%, which is below the average growth rate over the past 10 years.”

What it is effectively claiming is that the trend of the previous 10 years of known market size indicates a market size for the year 2005 more than 2% (2 years at 1% p.a.) above the actual size for the year 2003. This is criminally incorrect. The difference between the 2% increase over its 2003 sales and a 3% drop from its 2003 sales which the historic trend indicates represents some $16m of sales, probably half of which is overstated anticipated profit. This approximates the actual shortfall in profit experienced for 2005.

Feltex also projected a 1% p.a. increase in its sales due to increased market share. It does not attempt to say what its most recent known experience with respect to market share was but it can be calculated that it was losing share at the rate of 5% of its sales per annum. The 1% increase claimed was not realistic and fraudulent.