Cannasouth directors have changed the company's accounting policy for its merger with Eqalis from a reverse takeover basis to a business combination by acquisition basis.
This change means that Cannasouth will now be reported as the parent entity.
The balance of control shifted to Cannasouth after two nominated Eqalis directors resigned from the board in late December 2023.
The unaudited preliminary financial results of the group, which were released on Feb 29 2024, were based on a reverse takeover basis and will be restated on an acquisition basis in the annual report to be lodged in March 2024.
The change of accounting policy will impact the audited operating loss of the group and the carrying values of tangible and intangible assets of Eqalis as at Dec 31 2023.
Cannasouth said this policy change will not affect its day-to-day operations.
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