Yuuzoo's accounting may be too aggressive

YUUZOO Corp's latest financial results offer little assurance in the face of concerns about the company's cash burn and its liberal revenue recognition policies.

While the company could well justify not being able to generate cash at this stage of its development, what is more troubling is the aggressive way in which it tries to portray its finances.

Yuuzoo, which runs a social networking website, recently posted a tenfold increase in net profit to S$14.3 million for the second fiscal quarter ended June 30. That came on the back of a 235 per cent jump in revenue to S$35.8 million, with earnings per share leaping to 2.1 Singapore cents from a year-ago 0.21 Singapore cent and net asset value growing to 18.64 Singapore cents per share as at June 30, 2016 from 15.16 Singapore cents per share six months earlier.