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UNDERWATER ENGINEERING SERVICES, INC.
<br />NOTES TO FINANCIAL STATEMENTS
<br />DECEMBER 31, 2017 AND 2016
<br />Note 4 - Accounts Receivable, Net
<br />Accounts receivable, net at December 31, 2017 and 2016 is comprised of the following:
<br />2017 2016
<br />Fees billed
<br />Accrued fees
<br />Less: Allowance for doubtful accounts
<br />$ 1,537,737 $ 1,373,055
<br />63,439 54,764
<br />1,601,176 1,427,819
<br />27,100 32,100
<br />$ 1,574,076 $ 1,395,719
<br />Accrued fees represent the unbilled portions of the contract, which are applicable to the work
<br />performed. These fees are billable upon completion of various stages of the contracts and should
<br />be billed in the subsequent year.
<br />Under certain contracts, fees billed to customers include retainage, which are due upon
<br />completion of the contracts and acceptance by the customer. Total retainage amounted to $4,261
<br />and $87,698 at December 31, 2017 and 2016, respectively. At December 31, 2017 and 2016, the
<br />Company does not anticipate collection of approximately $3,000 and $66,000, respectively, of the
<br />retainage within one year.
<br />Note 5 - Related Party Transactions
<br />The Company is related to Greenman -Pedersen, Inc., GPI Geospatial, Inc., GPI Laboratories,
<br />Inc., Keller & Kirkpatrick, Inc., and GPI Michigan, Inc. (collectively, "the related parties") through
<br />common ownership.
<br />At December 31, 2017 and 2016, advances to these related parties were $24,231,491 and
<br />$23,471,391, respectively. These advances are unsecured, noninterest -bearing, and $3,500,000
<br />is expected to be collected within one year. During the years ended December 31, 2017 and
<br />2016, the Company advanced $760,100 and $1,275,971, respectively, to these related parties.
<br />At December 31, 2017 and 2016, included in total accounts receivable (see Note 4) are amounts
<br />related to these entities totaling $35,591 and $12,551, respectively. Included in revenues for the
<br />years ended December 31, 2017 and 2016 are amounts related to these entities of approximately
<br />$47,000 and $85,000, respectively.
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