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How did SARRAL answer the insolvency allegation?

In order to defeat the insolvency allegations in the liquidation application, SARRAL’s then CEO Mothobi Mutloatse adopted the so-called Charl Kocks method which converted the companies liabilities (royalties) into assets (revenue) by  a convenient re-interpretation of the company’s constitutive documents.

“This method of transforming liabilities into assets will go down in legal history” commented Judge Boruchowitz during the October 2009 court hearing.

The method, adopted in August 2004, was a reflexive response to the liquidation action, and was applied to outstanding Financial Statements from 2003 onwards.  SARRAL later contended that a  “fundamental error” in the financial statements had been corrected. It was a complete ‘volte face’  (about face) of the way the company had operated since its inception.

SARRAL’s revenue had previously come from commissions on royalties and interest on royalty payments awaiting distribution. Indeed, this was (and to date still is) their public face on their website and the basis upon which SARRAL recruits new members.

see: how does SARRAL meet its expenses?

or go to their web site:

sarral org.za

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