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Core Viewpoint - The Company has firmly rejected the allegations made by Buxton Helmsley USA, Inc. and its CEO, Alexander Erwin Parker, and has referred the matter to federal and state authorities for potential criminal prosecution [1][11]. Group 1: Allegations and Responses - Mr. Parker has accused the Company of improperly expensing software development costs that should be capitalized, claiming this would "unlock value" and demanding two board seats and a consulting contract that could yield him $24 million [3][10]. - The Company has refuted Mr. Parker's accounting allegations, asserting that his claims are based on misunderstandings of accounting standards and practices [4][15]. - The Company has stated that its financial statements and accounting judgments are sound and have been reviewed by third-party experts and auditors [17][23]. Group 2: Threats and Coercive Tactics - Mr. Parker has engaged in a campaign of intimidation, sending numerous letters threatening reputational damage to Company directors unless they comply with his demands [4][6]. - Specific threats included disciplinary referrals to the State Bar of California against directors unless they supported his agenda [6][8]. - The Company views these tactics as coercive and inappropriate, leading to its decision to involve federal and state authorities [5][11]. Group 3: Company Governance and Future Actions - The Company has reassured stockholders of its commitment to integrity and governance standards, emphasizing that it will not be swayed by coercive tactics [23]. - The Company plans to file its Annual Report on Form 10-K for Fiscal Year 2025, which will reflect its continued application of accounting standards [17]. - The Company has also indicated that it will file a Form 8-K to provide transparency regarding the ongoing situation with Mr. Parker and BuHeUI [23].

Core Viewpoint - Daily Journal Corporation is addressing allegations from Buxton Helmsley USA, Inc. regarding improper accounting practices related to software development costs, asserting that it has complied with accounting standards [1][2]. Group 1: Allegations and Responses - Buxton Helmsley USA, Inc. claims that Daily Journal Corporation should capitalize its software development costs instead of expensing them, suggesting this change would unlock shareholder value [2]. - The Audit Committee of Daily Journal Corporation reviewed the allegations and confirmed that the company is correctly accounting for its software development costs in accordance with ASC 950-20 [3]. Group 2: Accounting Standards Explanation - Historically, software companies followed ASC 985-20, which allows capitalization of development costs only after technological feasibility is established and before general release [4]. - The evolution of software development practices, particularly the adoption of agile methodologies, has shortened the capitalization window, making it rare for companies to incur significant costs eligible for capitalization [6]. - Companies developing software as a service (SaaS) may capitalize costs under ASC 350-40, which has a longer development window compared to ASC 985-20 [7]. Group 3: Misunderstandings and Clarifications - Buxton Helmsley USA, Inc. appears to have misunderstood the accounting practices of other companies, as they likely use different standards for capitalizing costs [8]. - Daily Journal Corporation emphasizes that it will continue to expense development costs when appropriate and capitalize them when justified, ensuring transparency in reporting R&D costs [9]. Group 4: Call for Resolution - Daily Journal Corporation urges Mr. Parker to cease his unfounded attacks and allow the company to focus on creating actual business value for shareholders [11].

Core Viewpoint - Daily Journal Corporation is responding to a proposal from Buxton Helmsley USA, Inc. regarding the accounting treatment of software development costs, which could potentially unlock significant equity value for shareholders [2][3]. Group 1: Proposal and Impact - Buxton Helmsley USA, Inc. suggested that Daily Journal Corporation should capitalize software development costs instead of expensing them, which could "unlock $160+ million in incremental equity value" for shareholders [3]. - The proposal included a request for a consulting engagement that would compensate Mr. Parker with $24 million in equity if the stock price increased accordingly [3]. Group 2: Company’s Accounting Practices - Daily Journal Corporation has been transparent about its practice of expensing software development costs for over a decade, adhering to GAAP and ASC 985-20 accounting rules [5]. - The company believes its accounting for the eSeries® product line development is correct and has been reviewed without issue by three different national accounting firms during annual audits [5]. Group 3: Response to the Proposal - The Board and Audit Committee decided to engage an independent accounting consultant to review the accounting practices, which led to Mr. Parker's subsequent actions [7]. - Following the decision to not engage Buxton Helmsley, Mr. Parker expressed dissatisfaction and reported the company to the SEC [8][9]. Group 4: Communication and Demands - Mr. Parker's correspondence included demands for the immediate resignation of the CEO and CFO, which the company views as an overreach following the decision to consult an independent firm [10]. - The company has offered to discuss its accounting practices with the SEC if they wish to engage [9].