Gilbert Bergsman
Eichler Bergsman & Co., LLP Paul Eichler
Certified Public Accountants Michael E. Silverman
404 Park Avenue South, New York, New York 10016
Tel 212-447-9001 Fax 212-447-9006
UNITED STATES SECURITIES
AND EXCHANCE COMMISSION
450 Fifth Street, N.W.
Washington, D.C. 20549
Attn: Filings
Re: In the matter of eSAFFTYWORLD, Inc, (HO-09343)
Gentlemen:
We have previously submitted a letter dated Feb 15, 2002 to our former
client, eSAFETYWORLD, Inc. (the "Company") after their forwarding to us a draft
copy of Form 8-K, that the Company intended to file with the SEC regarding the
change of accountants. A copy of that letter is attached. In that letter to the
Company we stated that we believed that the disclosures in the draft 8-K (copy
attached) were inadequate and did not explain our disagreements and reasons for
our resignation in accordance with subparagraph (iv) and (v) of 304(a) (i) of
Regulation 229.304. The following elaborates on the four concerns in that
letter.
First, the 8-K did not reflect that if the changes we required in income
recognition with respect to the June, 30, 2001 annual report concerning complete
reductions in the recognition of consulting fee income from other companies had
not been made in accordance with our requirements, we would have then resigned
or made reference to the subject matter of such disagreement giving an adverse
opinion in our report. This disclosure is required in the 8-K in accordance with
subparagraph (iv) of the Regulation.
Second, with respect to the Company's December 31, 2001 second quarter
we received the Company's trial balances, schedules and a draft 1O-Q on February
11, 2002. Upon reviewing this material we had disagreements regarding the amount
shown for goodwill ("Acquired Intangible"), deferred contract costs and loans
and advances to related individuals and investments in companies related to
insiders. If the Company had not then agreed to substantially increase the
allowances and reserves for these items, we would have then resigned.
Notwithstanding the increased reserves for these items, our continuing concerns
about these items contributed to our subsequent decision to resign. This
disclosure is required to be set forth in the 8-K in accordance with
subparagraph (iv) of the Regulation.
Securities and Exchange February 27, 2002
Commission Page Two -
Third, our letter to the Audit Committee, dated November 21, 2001
(copy attached) was delivered to the Company without our having received a copy
of the NASD letter of November 5, 2001 (copy attached) that notified the Company
of the NASD's intention to delist the Company. Our firm first received the
November 5, 2001 letter on February 12, 2002. In our February 15, 2002 letter to
the Company we stated that the November 21, 2001 letter is withdrawn and that
the Company's Audit Committee should be notified of our action. The Company's
action in securing from us the November 21, 2001 letter without disclosing to us
the NASD letter of Novernber 5, 2001 is one of the primary reasons for our
resignation and should be disclosed in the 8-K as required by subparagraph (v)
of the Regulation.
Fourth, we did not see in advance or participate, in the preparation of
the Company's filing of the Form 12b-25 on September 28, 2001. In that filing,
the Company included amounts for revenues and net income for the June 30, 2001
fiscal year without first discussing with us the disclosure of such amounts.
Those amounts were first presented to us in trial balances and schedules,
and then in a draft 1O-K received approximately two days before the 12b-25
filing. Beginning shortly before September 28, 2001 we were beginning to
question the Company's income recognition policy as it effected revenues and net
income. For the 10-K filing we required substantial reductions in revenues and
resultant net income, and would have then resigned if such reductions had not
been made. We only learned that the 12b-25 contained the revenue and net
income amounts when we read the reference to them on page 6 of the NASD letter
of November 5, 2001 received by us on February 12, 2002. The failure to earlier
disclose to us these amounts in that filing is another primary reason for our
resignation. This disclosure is required under subparagmphs (iv) and (v) of
the Regulation.
Based on the above we concluded that we can no longer rely on
management's representations and that the foregoing should be disclosed in the
8-K.
Respectfully,
EBCO:blz /s/Eichler Bergsman & Co., LLP
Enclosures Eichler Bergsman & Co., LLP