'While we have not yet received a Revenue Agent’s Report generally issued at the conclusion of an IRS examination, in September 2020, we received a Draft Notice of Proposed Adjustment from the IRS for the 2013 tax year relating to the valuation of our international intellectual property which was sold to a subsidiary in 2013'
Well, you spend money as part of doing business, but then, in theory, you make some money. This is revenue. Revenue is taxed at 21% in the US as of the 2019 tax year. Now, if you screw up, and the IRS catches you, you owe penalties. And you owe interest on the money you didn’t pay. And these can add up, especially, like the S-1 filing says, if you have irregularities dating back 7 years.
I’m sure they will have to make a more detailed explanation of this at some point, and it should make for a good read whenever the release it. And they may take their accounting firm to court, because this is large enough to at least suspect negligence or fraud. But until something else happens, all we have is speculation.
