0000074688
2011-10-30
2012-04-28
0000074688
2012-04-28
0000074688
2011-10-29
0000074688
2012-01-29
2012-04-28
0000074688
2011-01-30
2011-04-30
0000074688
2010-10-31
2011-04-30
0000074688
2010-10-30
0000074688
2011-04-30
iso4217:USD
xbrli:shares
iso4217:USD
xbrli:shares
OPT SCIENCES CORP
0000074688
10-Q
2012-04-28
false
--10-27
No
No
Yes
Smaller Reporting Company
Q2
2012
0.25
0.25
1000000
1000000
1000000
1000000
224415
224415
<div style="text-align: center; font: 11pt Arial"><div style="font: 11pt Arial"><p style="text-align: justify"><b>2. INVENTORIES</b><br /><br />Inventories consisted of the following:</p>
<table align="center" style="font: 10pt Arial; border-collapse: collapse; height: 0.2in">
<tr style="border: #000000 1px solid; background-color: #FFFFFF; height: 30px">
<td style="width: 130pt"> </td>
<td style="width: 120px; vertical-align: bottom; text-align: center">April 28, 2012<br /><u>  (Unaudited)  </u></td>
<td style="width: 5px"> </td>
<td style="width: 120px; vertical-align: bottom; text-align: center"><u>October 29, 201</u>1</td>
</tr>
<tr>
<td style="margin-left: 5px">Raw materials and supplies</td>
<td style="padding-right: 25px; text-align: right">$    389,907</td>
<td> </td>
<td style="padding-right: 25px; text-align: right">$    336,176</td>
</tr>
<tr style="background-color: #CCFFFF">
<td style="margin-left: 5px; height: 18px">Work in progress</td>
<td style="padding-right: 25px; text-align: right; height: 18px">301,458</td>
<td style="height: 18px"></td>
<td style="padding-right: 25px; text-align: right; height: 18px">309,769</td>
</tr>
<tr>
<td style="margin-left: 5px">Finished goods</td>
<td style="padding-right: 25px; text-align: right"><u>      118,575</u></td>
<td> </td>
<td style="padding-right: 25px; text-align: right"><u>      110,776</u></td>
</tr>
<tr style="background-color: #CCFFFF">
<td style="margin-left: 5px">Total Inventory</td>
<td><p style="border-bottom: #000 1px double; margin-left: 25px; margin-right: 25px; text-align: right">$    809,940</p></td>
<td> </td>
<td><p style="border-bottom: #000 1px double; margin-left: 25px; margin-right: 25px; text-align: right">$    756,721</p></td>
</tr>
</table>
<p style="text-align: justify"> </p>
<p style="text-align: justify">End of quarter inventories are stated at the lower of cost (first-in, first-out) or market. The inventory included in unaudited quarterly financial statements and in this Form 10-Q is based on estimates derived from an unaudited physical inventory count of work-in-progress and raw materials. The Company provides for estimated obsolescence on unmarketable inventory based upon assumptions about future demand and market conditions. If actual demand and market conditions are less favorable than those projected by management, additional inventory write downs may be required. Inventory, once written down, is not subsequently written back up, as these adjustments are considered permanent adjustments to the carrying value of the inventory. The Company conducts an audited physical inventory at the end of the fiscal year in connection with its audited financial statements and preparation of its Form 10-K.</p></div></div>
<p style="text-align: justify"> </p>
<p style="margin: 0"> </p>
<p style="margin: 0"></p>
<p style="margin: 0"> </p>
<table align="left" style="font: 10pt Arial; border-collapse: collapse; height: 0.2in">
<tr style="border: #000000 1px solid; background-color: #FFFFFF; height: 30px">
<td style="width: 130pt"> </td>
<td style="width: 120px; vertical-align: bottom; text-align: center">April 28, 2012<br /><u>  (Unaudited)  </u></td>
<td style="width: 5px"> </td>
<td style="width: 120px; vertical-align: bottom; text-align: center"><u>October 29, 201</u>1</td>
</tr>
<tr>
<td style="margin-left: 5px">Raw materials and supplies</td>
<td style="padding-right: 25px; text-align: right">$    389,907</td>
<td> </td>
<td style="padding-right: 25px; text-align: right">$    336,176</td>
</tr>
<tr style="background-color: #CCFFFF">
<td style="margin-left: 5px; height: 18px">Work in progress</td>
<td style="padding-right: 25px; text-align: right; height: 18px">301,458</td>
<td style="height: 18px"></td>
<td style="padding-right: 25px; text-align: right; height: 18px">309,769</td>
</tr>
<tr>
<td style="margin-left: 5px">Finished goods</td>
<td style="padding-right: 25px; text-align: right"><u>      118,575</u></td>
<td> </td>
<td style="padding-right: 25px; text-align: right"><u>      110,776</u></td>
</tr>
<tr style="background-color: #CCFFFF">
<td style="margin-left: 5px">Total Inventory</td>
<td><p style="border-bottom: #000 1px double; margin-left: 25px; margin-right: 25px; text-align: right">$    809,940</p></td>
<td> </td>
<td><p style="border-bottom: #000 1px double; margin-left: 25px; margin-right: 25px; text-align: right">$    756,721</p></td>
</tr>
</table>
<div style="font: 11pt Arial"><p style="text-align: justify"><b>3.  REVENUE RECOGNITION</b><br /><br />The Company recognizes revenue in accordance with U.S. GAAP and SEC Staff Accounting Bulletin ("SAB") No. 104, Revenue Recognition. SAB No. 104 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) the price to the buyer is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the price to the buyer charged for products delivered or services rendered and collectability of the sales price. The Company assesses credit worthiness of customers based upon prior history with the customer and assessment of financial condition. The Company's shipping terms are customarily FOB shipping point. </p></div>
<p style="margin: 0pt"></p>
<div style="text-align: center; font: 11pt Arial"><div style="font: 11pt Arial"><p style="text-align: justify"><b>4.  FINANCIAL INSTRUMENTS</b><br /><br /><b>SFAS No. 157</b> (ASC 820), "Fair Value Measurements", requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. SFAS No. 157 (ASC 820) establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.<br /><br />SFAS No. 157 (ASC 820) prioritizes the inputs into three levels that may be used to measure fair value:</p>
<table style="text-align: justify; width: 100%; font: 11pt arial">
<tr style="vertical-align: top">
<td style="text-align: right; width: 60px">Level 1</td>
<td>applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.</td></tr>
<tr>
<td> </td>
<td> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">Level 2</td>
<td>applies to assets or liabilities for which there are inputs other than
quoted prices that are observable for the asset or liability such as
quoted prices for similar assets or liabilities in active markets; quoted
prices for identical assets or liabilities in markets with insufficient
volume or infrequent transactions (less active markets); or model-derived
valuations in which significant inputs are observable or can be derived
principally from, or corroborated by, observable market data.</td></tr>
<tr>
<td> </td>
<td> </td></tr>
<tr style="vertical-align: top">
<td style="text-align: right">Level 3</td>
<td>applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or
liabilities.</td></tr>
</table>
<p style="text-align: justify; margin-bottom: 3px">The Company's financial
instruments consist principally of cash, cash equivalents, marketable
securities, trade accounts receivable, accounts payable and accrued liabilities.
Pursuant to SFAS No. 157 (ASC 820), the fair value of our cash equivalents and
marketable securities is determined based on "Level 1" inputs, which consist of
quoted prices in active markets for identical assets. The Company believes that
the recorded values of all of the other financial instruments approximate their
current fair values because of their nature and respective maturity dates or
durations.</p></div></div>
<p style="margin: 0pt"> </p>
<div style="font: 11pt Arial"><p style="text-align: justify"><b>5.    </b><b>RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS</b><br /><br /></p></div>
<p style="text-align: justify">In May 2011, the FASB issued Accounting Standards Update No. 2011-04 Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in GAAP and IFRS ("ASU 2011-04"), which amends ASC 820 Fair Value Measurement. ASU 2011-04 improves the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards. The amended guidance changes the wording used to describe many requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements. Additionally, the amendments clarify the FASB’s intent about the application of existing fair value measurement and disclosure requirements. Although ASU 2011-04 is not expected to have a significant effect on practice, it changes some fair value measurement principles and disclosure requirements. ASU 2011-04 is effective for interim and annual periods beginning after December 15, 2011, and must be applied prospectively. Early application is not permitted. We do not anticipate that the adoption of ASU 2011-04 will have a material impact on our financial position or results of operations.<br /><br />
In June 2011, the FASB issued the FASB Accounting Standards Update No. 2011-05 "Comprehensive Income" ("ASU 2011-05"), which was the result of a joint project with the IASB and amends the guidance in ASC 220, Comprehensive Income, by eliminating the option to present components of other comprehensive income (OCI) in the statement of stockholders?char_error? equity. Instead, the new guidance now gives entities the option to present all non-owner changes in stockholders?char_error? equity either as a single continuous statement of comprehensive income or as two separate but consecutive statements. Regardless of whether an entity chooses to present comprehensive income in a single continuous statement or in two separate but consecutive statements, the amendments require entities to present all reclassification adjustments from OCI to net income on the face of the statement of comprehensive income. The amendments in this Update should be applied retrospectively and are effective for public entities for fiscal years, and interim periods within those years, beginning after December 15, 2011. This statement will be effective for us for our 2013 fiscal year. We do not anticipate that the adoption of ASE 2011-05 will have a material impact on our financial position or results of operations.</p>
<p style="margin: 0pt"></p>
<div style="text-align: center; font: 11pt Arial"><div style="font: 11pt Arial"><p style="text-align: justify"><b>6.  SUBSEQUENT EVENTS</b></p>
<p style="text-align: justify">The Company is not aware of any event that occurred subsequent to the balance sheet date but prior to the filing of this report that could have a material impact on our financial position or results of operations.</p></div></div>
<p style="margin: 0pt"> </p>
1594611
1751489
8398276
1652492
1112833
907576
809940
756721
10811
24015
10988
13888
79620
87482
7885965
7620449
11564786
11204381
114006
114006
532978
532978
2145896
2137276
43268
43268
2836148
2827528
2081562
2010575
754586
816953
2837
2837
12322209
12024171
0
42761
60018
0
163168
99284
0
172010
128479
177230
45925
85925
9592
3194
406943
537643
250000
250000
272695
272695
11555019
11264161
187218
187218
11915266
11486528
12322209
12024171
59779
0
24770
-113110
3015636
1629022
1470775
3296917
2239235
1218354
996674
2205194
776401
410668
474101
1091723
10007
3967
3141
10311
443370
218564
241920
465300
453377
222531
245061
475611
323024
188137
229040
616112
170033
65238
12976
28747
493057
253375
242016
644859
-202200
-103900
-99200
-264400
290857
149475
142816
380459
11264162
11405544
10639144
10401501
11555019
11555019
10781960
10781960
775585
775585
775585
775585
0.38
0.19
0.18
0.49
70988
72641
-205257
65193
-53219
-36607
13204
-422
2900
-1650
7862
-60161
63884
-1180
-172010
3775
-48751
-48018
-40000
-37578
6398
4483
-88262
340935
315408
7086719
255412
0
434228
130625
34900
0
-60018
0
8620
0
-156878
-6745784
-68616
-7086719
<p style="margin: 0"></p>
<div style="text-align: center; font: 11pt Arial"><div style="font: 11pt Arial"><p style="text-align: justify"><b>1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</b></p>
<p style="text-align: justify">The accompanying consolidated financial statements include the accounts of Opt-Sciences Corporation, Inc. and its wholly-owned subsidiary, O&S Research, Inc. All significant intercompany accounts and transactions have been eliminated in consolidation.<br /><br />
These consolidated financial statements have been prepared by the Company, without audit, and reflect normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the results for the first six months of the Company's fiscal year 2012. These consolidated financial statements do not include all disclosures associated with annual consolidated financial statements and, accordingly, should be read in conjunction with footnotes contained in the Company's consolidated financial statements for the year ended October 29, 2011 together with the auditors' report filed as part of the Company's 2011 Annual Report on Form 10-K.<br /><br />
The preparation of these consolidated financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
</p>
<p style="text-align: justify"></p></div></div>
<p style="margin: 0"> </p>
<p style="text-align: justify"><b>1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</b></p>
<p style="text-align: justify">The accompanying consolidated financial statements include the accounts of Opt-Sciences Corporation, Inc. and its wholly-owned subsidiary, O&S Research, Inc. All significant intercompany accounts and transactions have been eliminated in consolidation.<br /><br />
These consolidated financial statements have been prepared by the Company, without audit, and reflect normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of the results for the first six months of the Company's fiscal year 2012. These consolidated financial statements do not include all disclosures associated with annual consolidated financial statements and, accordingly, should be read in conjunction with footnotes contained in the Company's consolidated financial statements for the year ended October 29, 2011 together with the auditors' report filed as part of the Company's 2011 Annual Report on Form 10-K.<br /><br />
The preparation of these consolidated financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
</p>
389907
336176
301458
309769
118575
110776
775585