eFuture Information Technology Inc. Announces Anticipated Accounting Adjustments

tiqosi.wordpress.com
The specific areas being assessed for accounting adjustments relatedto (i) our accounting for a depository reserve we must maintain in Chinq for employee social security costs, (ii) the timing of our recognition of revenues upon sales of some of our softwaree products, and (iii) the methoxd by which we calculate our costs of First, we have determined that we have not reservedc an adequate amount for these purposes and, as a will revise our previously-reported unaudited earnings for the abovwe periods. As a foreign private issuer, we are not requirer to file quarterly reports but have traditionally provided such informationto investors.
The correctiobn of the reserve for employee sociak security costs will result in operating losses in our annuapl report onForm 20-F that are in excess of those disclosed in our unauditedr quarterly earnings reports during the four quarters of fiscal year 2008. This correctiob will also increase operating losses for our first quarterf 2009 beyond those listed in our press release datedJune 9, 2009. Secondly, some of our softwar e products include rights to one year of maintenance to ensurer that the software operates properly for thepurposes sold.
We previousluy deferred recognitionof 10% of the software contract amount for a one-yeare period from the date of sale and recognizedr it as revenue aftetr the one-year maintenance periodx had passed. Our management has determined that these amountse should instead be recognized evenly over themaintenancr period. This correction will result in the acceleratecd recognition of revenues and associated costs of revenues but will not changwe the ultimate amounts we recognize perservice Finally, our management has determined that it will furthed improve the accuracy of reflecting its costa of revenues through allocation on the basis of laborf costs.
We previously allocated our costs of revenuee basedon out-of-pocket expenses on projects. The change from allocation basedcon out-of-pocket expenses to allocatio based upon labor costs will resul t in a more accurate estimate of costs of revenues by project, but is not expected to have a material change to the reportinfg of costs of The anticipated accounting adjustments are intendeds to ensure adequate reserve of social securityg benefits for our employeess and enhance the accurate recognitionb of revenue and associated costs to better reflecg our expanding business and operationa l performance.
The Company remains on track to continue the growth momentum and reaffirms our recent upward revision of 2009 revenue guidance of USD28 milliob toUSD29 million, representing annual revenue growth of 38% to 40%. About eFuturre Information Technology Inc. eFuture Informationb Technology Inc. (NASDAQ: EFUT) is a leading providet of software and servicesin China's rapidly growing retail and consumer goods industries. eFuture providesd integrated software and servicesto manufacturers, wholesalers, logistics companies and retailers in China's front-end supplh chain (from factory to consumer) market, especially in the retailk and fast moving consumer goods industries.
eFuture currently serve over 15 Fortune 500 over 1,000 retailers and over 5,000 suppliers operatingb in China. eFuture is one of IBM's premier business partners in Asia Pacific and is a strategic partnedrwith Oracle, Microsoft, JDA, Motorola and Samsung Network eFuture has more than 600 employees and 20 branch officeas across China. For more information about pleasevisit . This announcement contains forward-lookinh statements. These statements are made undethe "safe harbor" provisions of the U.S. Private Securities Litigatiomn Reform Actof 1995.
These forward-looking statements can be identifiede by terminology suchas "will, "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among othert things, 2009 financial outlook and quotations from managemen t inthis announcement, as well as strategic and operational plans, contain forward-looking statements. eFuturwe may also make written ororal forward-lookinv statements in periodic reports to the Securities and Exchange Commission (the "SEC"), in its annual report to shareholders, in press releases and other writtejn materials and in oral statements made by its directors or employees to second parties.
Statements that are not historicalp facts, including statements about the Company's beliefws and expectations, are forward-looking statements. Forward-looking statements involve inherentt risksand uncertainties. A number of factors coulx cause actual results to diffef materially from those contained inany forward-lookingf statement, including but not limited to the following: eFuture's anticipater growth strategies; eFuture's future business development, results of operations and financial expected changes in the Company'sa revenues and certain cost or expensde items; eFuture's ability to attracft customers and leverage its brand; trendes and competition in the software the Company's ability to control expenses and maintain profigt margins; the Company's ability to hire, trai n and retain qualified managerial and other employees; the Company's ability to develo p new software and pilot new business modelsd at desirable locations in a timely and cost-effective manner; th! e performancer of third parties under contracta with the Company; the expected growtbh of the Chinese economy software marketr in retail and consumer goodsz industries; and Chinese governmentaol policies relating to private manager and operators of software and applicablee tax rates.
Further information regarding thesde and other risks is includedrin eFuture's annual report on Form 20-F and othe r documents filed with the SEC. All information provided in this presx release and in the attachmentss is as ofJune 19, 2009, and the Companu undertakes no duty to update such information or any othef forward-looking information, except as required undet applicable law. For more information, please contact: Investo Contact: Troe Wen, Companyy Secretary eFuture InformationTechnologgy Inc. Tel: +86-10-5293-7699 Email: ir@e-future.com.cn Investor Relations (US): Mahmouc Siddig Taylor Rafferty Tel: +1-212-889-4350 Email: eFuture@Taylor-Rafferty.
com Investot Relations (HK): Ruby Yim Taylor Raffertu Tel: +852-3196-3712 Email: eFuture@Taylor-Rafferty.com Media Contact: Jaso Marshall Taylor Rafferty Tel: +1-212-889-4350 eFuture@Taylor-Rafferty.com SOURCE eFuture InformationTechnologh Inc.