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U.S. Securities and Exchange Commission

Before the

Release No. 49934 / June 29, 2004

Release No. 2047 / June 29, 2004

File No. 3-11516

In the Matter of





On June 9, 2004, the Securities and Exchange Commission ("Commission") instituted public administrative proceedings pursuant to Rule 102(e)(1) of the Commission's Rules of Practice [17 C.F.R. § 201.102(e)(1)] against James H. Peach, a Canadian chartered accountant ("Peach" or "Respondent"), to determine whether Peach engaged in improper professional conduct and to determine whether any order should be issued as to Peach pursuant to Rule 102(e)(1) of the Commission's Rules of Practice.1


Peach has submitted an Offer of Settlement ("Offer"), which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission, or in which the Commission is a party, and without admitting or denying the findings herein, except as to the Commission's jurisdiction over him and over the subject matter of these proceedings, which are admitted, Peach consents to the entry of this Order Making Findings and Imposing Sanctions Pursuant to Rule 102(e)(1) of the Commission's Rules of Practice ("Order"), as set forth below.


On the basis of this Order and the Offer, the Commission makes the following findings2 :

A. Peach, age 48, is a resident of Coquitlam, British Columbia, Canada, and is licensed to practice as a Chartered Accountant in British Columbia.

B. LASV Enterprises, Inc. ("LASV") is a Delaware corporation located in British Columbia. Between 1993 and April 2004, its common stock was registered with the Commission pursuant to Section 12(g) of the Securities Exchange Act of 1934. LASV filed periodic reports with the Commission from 1994 through 2001.

C. Peach audited and reported on LASV's financial statements for the year ended September 30, 2000, which were included in LASV's Form 10-KSB and Amended Form 10-KSB filed with the Commission on January 12, 2001, and April 4, 2001, respectively. These financial statements materially overstated LASV's assets and liabilities, specifically:

    1. LASV recorded a Dominican Republic real estate property as its sole asset on its balance sheet with a value of $2.825 million. LASV, in fact, did not own the property as of September 30, 2000, the date of the audited financial statements. LASV had merely indirectly paid $875,000 to enter into a purchase agreement for the property that required LASV to pay the $1.95 million purchase price balance by October 19, 2000. LASV never paid the purchase price balance and never acquired the property; and

    2. LASV also recorded a "note payable" as a liability on its September 30, 2000, balance sheet with a value of $1.95 million. The financial statements notes described the note as "non-interest bearing" with "no specific terms of repayment." In fact, LASV had no such note payable, and the $1.95 million referenced in the balance sheet was merely the purchase price balance for the Dominican property.

D. With respect to the audit referenced in paragraph III.C. above, Peach issued an audit report which represented that LASV's financial statements presented fairly, in all material respects, the financial position of the company in conformity with generally accepted accounting principles ("GAAP"), when, in fact, those financial statements were materially false. Peach also represented in his audit report that his audit of LASV's financial statements was conducted in accordance with generally accepted auditing standards ("GAAS"), when it was not.

E. Over the course of his audit engagement with LASV, Peach failed to determine that LASV recorded assets and liabilities in a manner that did not comply with GAAP. GAAP requires that a purchase agreement's value be recorded at cost, that is, the amount paid to acquire the purchase agreement, unless the acquisition is or becomes less than probable, at which time the cost is to be expensed.3 LASV failed to comply with GAAP because it recorded the Dominican property at its full value as if LASV already owned the property, instead of recording it at an amount equal to the cost to acquire the purchase agreement, or, if the acquisition was less than probable, zero as required by GAAP.

F. In the course of auditing LASV's financial statements, Peach failed to comply with GAAS, as follows:

    1. Peach failed to prepare audit programs or to conduct audit risk assessments sufficient to determine the nature, timing, and extent of substantive tests needed for the audit;

    2. Peach failed to obtain sufficient competent evidential matter upon which to base an opinion. Specifically, Peach failed to obtain, or plan to obtain, any evidence from third parties about LASV's purported ownership of the Dominican property or its purported note payable; and

    3. Peach issued an audit report containing an unqualified opinion which stated that LASV's financial statements fairly presented the company's financial condition in conformity with GAAP when, in fact, they did not.

G. As a result of the conduct described above, Respondent Peach engaged in improper professional conduct within the meaning of Rule 102(e)(1) of the Commission's Rules of Practice.


In view of the foregoing, the Commission deems it is appropriate to impose the sanction agreed to in Peach's Offer.

Accordingly, it is hereby ORDERED, effective immediately, that Peach is denied the privilege of appearing or practicing before the Commission as an accountant.

For the Commission, by its Secretary, pursuant to delegated authority.

Jonathan G. Katz


The Commission may censure a person or deny, temporarily or permanently, the privilege of appearing or practicing before it in any way to any person who is found by the Commission after notice and opportunity for hearing in the matter…:

(ii) To be lacking in character or integrity or to have engaged in unethical or improper professional conduct…; (iv) With respect to persons licensed to practice as accountants, "improper professional conduct: under §201.102(e)(1)(ii) means: (A) Intentional or knowing conduct, including reckless conduct, that results in a violation of applicable professional standard; or (B) Either of the following two types of negligent conduct: (1) A single instance of highly unreasonable conduct that results in a violation of applicable professional standards in circumstances in which an accountant knows, or should know, that heightened scrutiny is warranted. (2) Repeated instances of unreasonable conduct, each resulting in a violation of applicable professional standards, that indicate a lack of competence to practice before the Commission.

Payments to obtain an option to acquire real property shall be capitalized as incurred. All other costs related to a property that are incurred before the enterprise acquires the property, or before the enterprise obtains an option to acquire it, shall be capitalized if all of the following conditions are met and otherwise shall be charged to expense as incurred: (a) The costs are directly identifiable with the specific property. (b) The costs would be capitalized if the property were already acquired. (c) Acquisition of the property or of an option to acquire the property is probable. This condition requires that the prospective purchaser is actively seeking to acquire the property and has the ability to finance or obtain financing for the acquisition and that there is no indication that the property is not available for sale.

FASB Statement of Financial Accounting Standards No. 5 defines "probable" as "likely to occur."



Modified: 06/29/2004