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PRPO Precipio

Filed: 26 May 05, 8:00pm
                                                                    EXHIBIT 99.2

TRANSGENOMIC, INC.
Cash Flow Restatement

2004 --------------------------------------------- Three Months Ended Six Months Ended March 31, June 30, --------------------- --------------------- Reported Restated Reported Restated --------- --------- --------- --------- CASH FLOWS FROM OPERATING ACTIVITIES Depreciation and amortization (1) $ 1,048 $ 1,202 $ 2,102 $ 2,410 Purchase of trading securities (2) (3) $ 0 $ 0 $ 0 $ 0 Trading securities acquired in settlement of accounts receivable (2) $ 0 $ 0 $ 0 $ 0 Proceeds from sale of trading securities (2) (3) $ 0 $ 0 $ 0 $ 0 Accounts receivable (2) $ 423 $ 423 $ (1,926) $ (1,926) Net cash flows from operating activities $ (4,003) $ (3,849) $ (7,260) $ (6,952) CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from the sale of securities (2) $ 933 $ 933 $ 932 $ 932 Change in other assets (1) $ 86 $ (68) $ 307 $ (1) Net cash flows from investing activities $ 584 $ 430 $ 106 $ (202) SUPPLEMENTAL CASH FLOW INFORMATION Available for sale securities acquired for goods and services $ 0 $ 959 $ 0 $ 959 2004 --------------------------------------------- Nine Months Ended Twelve Months Ended September 30, December 31, --------------------- --------------------- Reported Restated Reported Restated --------- --------- --------- --------- CASH FLOWS FROM OPERATING ACTIVITIES Depreciation and amortization (1) $ 3,145 $ 3,607 $ 4,009 $ 4,625 Purchase of trading securities (2) (3) $ 0 $ 0 $ 0 $ 0 Trading securities acquired in settlement of accounts receivable (2) $ 0 $ 0 $ (4,397) $ 0 Proceeds from sale of trading securities (2) (3) $ 0 $ 0 $ 4,269 $ 0 Accounts receivable (2) $ (2,469) $ (2,469) $ 1,063 $ (3,334) Net cash flows from operating activities $ (9,170) $ (8,708) $ (9,101) $ (12,754) CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from the sale of securities (2) $ 2,768 $ 2,768 $ 0 $ 4,269 Change in other assets (1) $ 488 $ 26 $ 1,138 $ 522 Net cash flows from investing activities $ 2,006 $ 1,544 $ 2,380 $ 6,033 SUPPLEMENTAL CASH FLOW INFORMATION Available for sale securities acquired for goods and services $ 0 $ 3,137 $ 0 $ 4,397 2003 --------------------------------------------- Three Months Ended Six Months Ended March 31, June 30, --------------------- --------------------- Reported Restated Reported Restated --------- --------- --------- --------- CASH FLOWS FROM OPERATING ACTIVITIES Depreciation and amortization (1) $ 835 $ 989 $ 1,762 $ 2,070 Purchase of trading securities (2) (3) $ 0 $ 0 $ 0 $ 0 Trading securities acquired in settlement of accounts receivable (2) $ 0 $ 0 $ 0 $ 0 Proceeds from sale of trading securities (2) (3) $ 0 $ 0 $ 0 $ 0 Accounts receivable (2) $ (1,330) $ (1,330) $ 995 $ 995 Net cash flows from operating activities $ (3,141) $ (2,987) $ (6,749) $ (6,441) CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from the sale of securities (2) $ 3,612 $ 3,612 $ 3,612 $ 3,612 Change in other assets (1) $ 212 $ 58 $ 147 $ (161) Net cash flows from investing activities $ 157 $ 3 $ (1,127) $ (1,435) SUPPLEMENTAL CASH FLOW INFORMATION Available for sale securities acquired for goods and services $ 0 $ 0 $ 0 $ 0 2003 --------------------------------------------- Nine Months Ended Twelve Months Ended September 30, December 31, --------------------- --------------------- Reported Restated Reported Restated --------- --------- --------- --------- CASH FLOWS FROM OPERATING ACTIVITIES Depreciation and amortization (1) $ 2,850 $ 3,312 $ 3,981 $ 4,597 Purchase of trading securities (2) (3) $ (1,565) $ (1,565) $ 0 $ (1,566) Trading securities acquired in settlement of accounts receivable (2) $ 0 $ 0 $ (1,843) $ 0 Proceeds from sale of trading securities (2) (3) $ 1,519 $ 1,519 $ 1,907 $ 1,519 Accounts receivable (2) $ 1,482 $ 1,482 $ 619 $ 342 Net cash flows from operating activities $ (9,880) $ (9,418) $ (13,245) $ (13,017) CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from the sale of securities (2) $ 3,612 $ 3,612 $ 3,612 $ 4,000 Change in other assets (1) $ 310 $ (152) $ 73 $ (543) Net cash flows from investing activities $ (1,724) $ (2,186) $ (2,719) $ (2,947) SUPPLEMENTAL CASH FLOW INFORMATION Available for sale securities acquired for goods and services $ 0 $ 0 $ 0 $ 277
(1) Amortization of capitalized software was inappropriately reflected in net cash flows from investing activities through the change in other assets. This adjustment appropriately reflects the amortization as an adjustment to reconcile net loss to net cash flows from operating activities. (2) Restricted common stock accepted as payment for goods and services from one of the Company's customers was incorrectly classified. These adjustments appropriately reflect these available for sale securities as investing activities and the receipt of securities in settlement of accounts receivable (available for sale securities acquired for goods and services) as non-cash supplemental cash flow information. (3) Purchase of trading securities and proceeds from sale of trading securities were inappropriately included certain available for sale securities. These adjustments appropriately reflect activities related to trading securities as operating activities and available for sale securities as investing activities.