DESCRIPTION OF BUSINESS AND SUMMARY OF ACCOUNTING POLICIES (AES)

6 Months Ended

Jun. 30, 2013

DESCRIPTION OF BUSINESS AND SUMMARY OF ACCOUNTING POLICIES

NOTE 1 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The accompanying unaudited interim financial statements of HII Technologies, Inc. ("we", "our", "HII" or the "Company") have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited consolidated financial statements and notes thereto for the years ended December 31, 2012 and 2011 contained in HII Technologies' Form 10-K originally filed with the Securities and Exchange Commission on March 24, 2013.  In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein.  The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.  Notes to the consolidated financial statements which would substantially duplicate the disclosure contained in the audited consolidated financial statements for the years ended December 31, 2012 and 2011 as reported in the Company's Form 10-K have been omitted.

Principles of consolidation

The consolidated financial statements include the accounts of HII and its wholly-owned subsidiaries KMHVC, Inc. (dba "South Texas Power") and Apache Energy Services, LLC ("AES").  AES launched a new operating division in January 2013 doing business as AES Safety Services providing safety consultancy services to the oilfield industry. Significant intercompany accounts and transactions have been eliminated.  A separate set of financials for AES from inception, January 4, 2012 through June 30, 2012, are presented following those of HII as AES satisfies the requirements for predecessor reporting.

Apache Energy Services, LLC [Member]

DESCRIPTION OF BUSINESS AND SUMMARY OF ACCOUNTING POLICIES

NOTE 1 - DESCRIPTION OF BUSINESS AND SUMMARY OF ACCOUNTING POLICIES

Description of Business.   Apache Energy Services, LLC ("Apache", "AES", "we", "our", "us" or the "Company") provides water transfer services in connection with the hydraulic fracturing ("fracing") of oil and gas reservoirs. AES arranges for up to millions of gallons to be delivered to frac pads and drill sites. The water transfer services can range from drilling water wells and digging water storage pits to arranging for miles of above ground temporary pipe and high volume pumps to address all of the logistics needs of water during fracing for an oilfield operator.  Once a frac job is completed, AES transfers the pipe, pumps and other temporary infrastructure to another location at the request of its customers.

Basis of presentation.  On September 27, 2012, HII Technologies, Inc. ("HII") acquired all of AES outstanding membership interests pursuant to the terms of a Securities Purchase Agreement dated September 26, 2012 by and among AES, the members of AES and HII.   AES was deemed the predecessor entity in this transaction.   The financials included herein are presented at their historical basis.

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 the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.