MJ Estate Second Accounting - Document & Summary & Discussion

ivy

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As promised before with Windy09 's tremendous help now we have the MJ Estate second accounting in it's 96 pages of glory (omitted persons given notice section)

The link to document is : http://www.scribd.com/doc/101284813/MJ-Estate-Second-Accounting

I will also embed it to the end of this post

My brief summary follows but please keep in mind that I'm not an accountant. We actually welcome discussion and information from knowledgeable parties about accounting

Summary:

Gross earnings as of May 31, 2012 is $475 Million.

Breakdown of $475 Million as follows
- $310 Million gross earnings between June 2009 – October 2010 (first accounting period)
- $134 Million gross earnings between November 2010 – December 2011. (second accounting period)
- $30 Million gross earnings between January 2012 – May 2012.

Alll debt is current

Hayvenhurst mortgage paid

$65 Million of Mijac debt is paid and Estate expect to pay it in full by the end of 2012.

Estate is not in a position to be closed yet, Executors asking for administration of the Estate to be extended for one more year.

The only sale happened was some tangible property sold to Richard LaPointe per the settlement agreement in Julien’s Auction lawsuit. Schedule H lists all the items LaPointe got per settlement agreement.

Hayvenhurst is stated that “it will be maintained long term for the benefit of the family”. Renovations are still ongoing.

Katherine is asking for onetime payment of $205,401 to cover her professional fees occurred in 2011. Katherine is also asking for additional $34,700 per month to pay for her accountant and lawyers as well as to cover the expenses of family house in Gary Indiana and a residence in Las Vegas. Estate is asking the judge to allow this onetime payment and monthly increase.

12 Inventory value appraisals are done showing property valued at $50,677,002. Estate says additional personal property was discovered in Las Vegas and at Rock n Roll and Grammy Museum which is in total believed to be $6,700,000.

Estate’s main assets are 50% share in Sony/ ATV, 100% share in Mijac, Michael’s name and likeliness, Neverland and trademarks.

MJ Business activities consists of 2 Cirque shows (second resident show is scheduled to open in June 2013), Ubisoft MJ Experience game, multiple album deal with Sony, commercial endorsements and a possible film and documentary about Michael Jackson.

At the time of his death Michael was facing at least 6 lawsuits. Executors have been part of at least 15 lawsuits. 4 of them are still active, the rest have been resolved favorably for the Estate. Estate has also faced 65 creditor claims.

Estate is also employing multiple law firms around the world to protect Michael’s copyrights and trademarks. Second accounting lists 19 law firms (all around the world) and over $13.5 million in legal costs.

Schedule A (beginning) and Schedule I (end) shows the list of tangible property and business interest of Michael and now MJ Estate

In addition to Hayvenhurst (valued at $4.1 M) and a condo (valued at $315 K), Michael (and now his Estate) has 87.5% undivided membership in Neverland.

Schedule I shows by the end of December 2011, personal tangible property of Michael valued at $13 Million and MJ Estate cash (or equivalent) at $19 Million.

Schedule D shows net income from trade or business during second accounting period (Nov 2010- Dec 2011) at $106,734,448.

Payments to Katherine and MJ’s kids are as follows (Nov 2010- Dec 2011)

Kids allowance $2,139,194
Katherine allowance $470,814
Calabasas residence expenses $436,187
Condo payments $15,569
Hayvenhurst improvements $73,962
Taxes on properties $144,605
Insurance (health and property) $106,033
House employees $658,915
Katherine lawyer fees $233,911
Guardian ad litem $ 54,478
Utilities costs $53,211
Security $654,414
Repair & Maintenance $194,127

Total $5,205,516

Estate has also given multiple loans to Katherine

Loan 1 to Katherine $235,000
Loan 2 to Katherne $250,000
Loan 3 to Katherine $75,000
Loan 4 to Katherine $6,000,000 (for Katherine's debt to Segye Times)

Total loans to Katherine $ 6,560,000

Total paid to Katherine and kids equal $ 11,765,516 ( $5,205,516 + $ 6,560,000)

Estate paid $50,862,363 in taxes and licenses.

Estate has an archiving project ongoing that they paid $789,450. They paid over 1 million dollars for storage of Michael’s property. Estate employees were paid $443,640. Estate paid $442,774 for public relations.

Total Co-executive & creative director compensation is $5,214, 933. The companies’ tables also show a $2,971,982 payment as Co-executive and creative director compensation, however I do not know if this is included in the Schedule G compensation of $5,214,933 or if it is a separate payment.


[scribd]101284813[/scribd]
 
Thank you!

What happens when the Estate is closed? Will there be no more projects? What about the 7-year deal with Sony - how is this going to be handled? Who is going to manage the money?
 
Thanks ivy, very interesting and useful. The estate is doing a great job.
 
Thank you!

What happens when the Estate is closed? Will there be no more projects? What about the 7-year deal with Sony - how is this going to be handled? Who is going to manage the money?

Estate will not close, they mean probate process. Currently Estate is going through probate which is ensuring all debts are paid first. Court is overseeing this process. Estate is saying they need at least one more year.

After the probate is over , Estate will continue to run but will not be under court's supervision.
 
Thank you Ivy for the summary and Windy09 for getting the document for us. Branca and McClain are s doing a tremendous job in growing Michael's estate and fending off the lawsuits .. They have been very generous to Katherine and even paid her last request ..

Also those that say its all Michael and the execs don't have to do anything to do the build this Estate is wrong - This is a huge business undertaking it doesn't grow all on it's own power. That point could be proved very quickly by placing the Estate under the Jackson families control - I'm sure this report would be reading much different if that was the case.

I also know Estate detractors will ignore everything positive here and focus only of the amount paid to execs for their most excellent work, stating they are are robbing the estate. In my opinion I think they have earned and worked hard for every Penney. The percentage they get paid as Execs is under the going rate for Most Estate execs receive.

Bravo MJ Estate :clapping:
 
good job estate if that family seen this they would walk away with their tails up their asses
 
"Michael Jackson's Facebook page is now... the seventh most popular Facebook fan page overall with more than 49 million followers. (The day before Michael Jackson died, he had less than 800,000 followers.)"
...
 
Well done Estate. All the Jackson that oppose the Executors of the Estate can suck it!
 
wow thanks Ivy for posting this! do u mind if i share this info to others whose interested?
 
It's interesting that the Estate owns 87.5% of Neverland. I was under the impression that it was 50/50 with Colony Capital. Did they buy back a share of it?

Plus, I don't understand why it's not counted as valued property (its appraised value is $1)
 
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Wow thank you so much. The estate has done an excellent job , one question,for the gross income was the earning from atv/Sony also included... Didnt they make like $70 million only From atv/sony every year?
 
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By the way we are going over the document with multiple people that are knowledgeable about accounting. Memefan is helping me to make sense of the document and she'll post her findings as well

We need to point out some stuff

- TMZ story made it sound like Estate will be totally debt free by the end of the year. However we think only Mijac debt will be paid by the end of 2012. Sony/ATV loan has been refinanced shortly after Michael's death and they are current on the payments. In our belief the document doesn't have anything that says Sony/ATV will be paid as well.
 
Michael (and now his Estate) has 87.5% undivided membership in Neverland.

michaeljacksonneverlandranchhome.jpg


14.jpg
 
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wow thanks Ivy for posting this! do u mind if i share this info to others whose interested?

sure

It's interesting that the Estate owns 87.5% of Neverland. I was under the impression that it was 50/50 with Colony Capital. Did they buy back a share of it?

I think it was always 87.5% share. The media reported that MJ was partners with Colony capital and I guess everyone assumed it was 50-50. Estate accounting has always shown it as a 87.5% share

Wow thank you so much. He estate has done an excellent job for the gross income was the earning from owning 50% atv/Sony also included... Didnt they make like $70 million only From atv/sony every year?

They make money from sony/ATV - I think it's $82 Million in this accounting (Memefan can correct me if I'm wrong) but remember most of that income is going to pay the loan on it.

edit : I'm wrong about the $82 M. It was Mijac's value and not what Sony/ATV brought in.
 
By the way we are going over the document with multiple people that are knowledgeable about accounting. Memefan is helping me to make sense of the document and she'll post her findings as well

We need to point out some stuff

- TMZ story made it sound like Estate will be totally debt free by the end of the year. However we think only Mijac debt will be paid by the end of 2012. Sony/ATV loan has been refinanced shortly after Michael's death and they are current on the payments. In our belief the document doesn't have anything that says Sony/ATV will be paid as well.

Yeah. It would be interesting to know what the current balance on the SONY/ATV debt is like.
 
ivy;3680028 said:
As promised before with Windy09 's tremendous help now we have the MJ Estate second accounting in it's 96 pages of glory (omitted persons given notice section)

The link to document is : http://www.scribd.com/doc/101284813/MJ-Estate-Second-Accounting

I will also embed it to the end of this post

My brief summary follows but please keep in mind that I'm not an accountant. We actually welcome discussion and information from knowledgeable parties about accounting

Summary:

Gross earnings as of May 31, 2012 is $475 Million.

Breakdown of $475 Million as follows
- $310 Million gross earnings between June 2009 – October 2010 (first accounting period)
- $134 Million gross earnings between November 2010 – December 2011. (second accounting period)
- $30 Million gross earnings between January 2012 – May 2012.

Alll debt is current

Hayvenhurst mortgage paid

$65 Million of Mijac debt is paid and Estate expect to pay it in full by the end of 2012.

Estate is not in a position to be closed yet, Executors asking for administration of the Estate to be extended for one more year.

The only sale happened was some tangible property sold to Richard LaPointe per the settlement agreement in Julien’s Auction lawsuit. Schedule H lists all the items LaPointe got per settlement agreement.

Hayvenhurst is stated that “it will be maintained long term for the benefit of the family”. Renovations are still ongoing.

Katherine is asking for onetime payment of $205,401 to cover her professional fees occurred in 2011. Katherine is also asking for additional $34,700 per month to pay for her accountant and lawyers as well as to cover the expenses of family house in Gary Indiana and a residence in Las Vegas. Estate is asking the judge to allow this onetime payment and monthly increase.

12 Inventory value appraisals are done showing property valued at $50,677,002. Estate says additional personal property was discovered in Las Vegas and at Rock n Roll and Grammy Museum which is in total believed to be $6,700,000.

Estate’s main assets are 50% share in Sony/ ATV, 100% share in Mijac, Michael’s name and likeliness, Neverland and trademarks.

MJ Business activities consists of 2 Cirque shows (second resident show is scheduled to open in June 2013), Ubisoft MJ Experience game, multiple album deal with Sony, commercial endorsements and a possible film and documentary about Michael Jackson.

At the time of his death Michael was facing at least 6 lawsuits. Executors have been part of at least 15 lawsuits. 4 of them are still active, the rest have been resolved favorably for the Estate. Estate has also faced 65 creditor claims.

Estate is also employing multiple law firms around the world to protect Michael’s copyrights and trademarks. Second accounting lists 19 law firms (all around the world) and over $13.5 million in legal costs.

Schedule A (beginning) and Schedule I (end) shows the list of tangible property and business interest of Michael and now MJ Estate

In addition to Hayvenhurst (valued at $4.1 M) and a condo (valued at $315 K), Michael (and now his Estate) has 87.5% undivided membership in Neverland.

Schedule I shows by the end of December 2011, personal tangible property of Michael valued at $13 Million and MJ Estate cash (or equivalent) at $19 Million.

Schedule D shows net income from trade or business during second accounting period (Nov 2010- Dec 2011) at $106,734,448.

Payments to Katherine and MJ’s kids are as follows (Nov 2010- Dec 2011)

Kids allowance $2,139,194
Katherine allowance $470,814
Calabasas residence expenses $436,187
Condo payments $15,569
Hayvenhurst improvements $73,962
Taxes on properties $144,605
Insurance (health and property) $106,033
House employees $658,915
Katherine lawyer fees $233,911
Guardian ad litem $ 54,478
Utilities costs $53,211
Security $654,414
Repair & Maintenance $194,127

Total $5,205,516

Estate has also given multiple loans to Katherine

Loan 1 to Katherine $235,000
Loan 2 to Katherne $250,000
Loan 3 to Katherine $75,000
Loan 4 to Katherine $6,000,000 (for Katherine's debt to Segye Times)

Total loans to Katherine $ 6,560,000

Total paid to Katherine and kids equal $ 11,765,516 ( $5,205,516 + $ 6,560,000)

Estate paid $50,862,363 in taxes and licenses.

Estate has an archiving project ongoing that they paid $789,450. They paid over 1 million dollars for storage of Michael’s property. Estate employees were paid $443,640. Estate paid $442,774 for public relations.

Total Co-executive & creative director compensation is $5,214, 933. The companies’ tables also show a $2,971,982 payment as Co-executive and creative director compensation, however I do not know if this is included in the Schedule G compensation of $5,214,933 or if it is a separate payment.


[scribd]101284813[/scribd]
Thank you for this Ivy.
The estate mentioned at one point that the children would receive $30million into their trusts every 6 months... maybe I missed it but I don't see that here. The first deposit of $30million was in Sept 2011 and another less than 6 months later if I remember correctly. Does anyone know anything about this?
 
Some payments really stand out. They pay over 13 mil to safeguard his copyright worldwide, and it is a pity that part of the safeguarding has to be done here against Mann Katherine's business partner, thus adding to the expense.

Good to see that Neverland is 87.5 percent, because many reports were saying it was 50 percent.

It is crazy that on top of all the money Katherine gets she also has a loan of over 6 mil. How does she repay? Does the estate take a few thousand out of her allowance each month. She is already in her 80s, so they will have to take a large amount to ensure all is paid back.

She also asked the estate for :

onetime payment of $205,401 to cover her professional fees occurred in 2011. Katherine is also asking for additional $34,700 per month to pay for her accountant and lawyers as well as to cover the expenses of family house in Gary Indiana and a residence in Las Vegas. Estate is asking the judge to allow this onetime payment and monthly increase.

These professional fees, do they involve the attorneys that she is using to sue AEG? It would be interesting to see what her bills for professional fees were before 09. Why is she the only one covering the expenses of the house in Gary. I thought this was a family house, but it seems only Michael pays for it. The home in Las Vegas, who owns it? Katherine or the family? Here again Michael pays for it, and who is living in the home right now? Here we have the estate asking the judge to allow the increases, and yet the estate is attacked.
 
Thanks ivy and everyone elsr.

i dont know why randy and co keep moaning when u look at all these loans kj keeps getting which are no doubt going to her cubs. imo the estate are way to soft. mj wanted his mother looked after. no one else.and theres no way the estate are ever gonna get them back unless it comes from damages ftom howard mann and why money for the gary house did mj own it? i thought other cousins etc lived there.

so colony paid 25mill for a 12% share of the ranch? .estate should buy it all back so the kids have somewhere to hide from the family when they turn 18
 
Katherine is asking for onetime payment of $205,401 to cover her professional fees occurred in 2011. Katherine is also asking for additional $34,700 per month to pay for her accountant and lawyers as well as to cover the expenses of family house in Gary Indiana and a residence in Las Vegas. Estate is asking the judge to allow this onetime payment and monthly increase.

I thought Mike already owned the house in Indiana and now she wants to cover the expenses in Las Vegas isn't that the house Janet bought that Joe lives in also.
 
I wonder if kj has made anywhere near 200k of her deals with mann etc.seems to have alot of bills but nothing coming in.
 
I have a question does the loans all have to be paid off before estate is closed? Is that the reason for needing another year to finish.
 
The estate doesnt close. just the probate. and probate runs until all the debts are sorted. so yes id think the estate want another year to clear everything deal with lawsuits etc
 
Thanks Windy and Ivy.

I thought Janet bought LV house for Katherine, but Joe is living there now? Shouldn't Janet fork over the money for it upkeep?
Gary home, I thought cousin lives there?

Those loans for Katherine, I suppose she used most of it to pay Randy and Jermaine child support in order to get Jermaine back from Africa.

All the lawyers that are looking after MJ copyrights! As somebody already mentioned it, some of them caused by Jacksons themselves, case against Joe+Julian Rouass stinky business, Katherine+ Mann and some other.

Jackson Family (minus PPB) sit on your arses and let the executors do their job, they are doing fantastic job!
 
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Katherine get alot of money...IMO the estate is doing an amazing job, and as someone else said, they are too soft with Mrs J, they seem to give her everything she wants (and they call it a loan, but seriously, as if they'll get that money back)

Thanks Ivy!
 
Those loans are against Michael's will, we all know where those loans went to->her cubs pockets. The estate is too soft to Katherine. Btw the estate is obliged to send the copy of the accounting documents to the beneficiaries- children's guadian ad litem and Katherine. I am sure both of them have seen this already. The executors did a great jobs and I felt sorry for them to deal with those greedy, delusional, irrational, useless Jacksons and their sense of entitlement.
 
John Branca and John McCain are doing a Excellent job, and so are you Ivy. thank you.
 
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