SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________________
FORM 10-K/A

x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
 
OF THE SECURITIES ACT OF 1934
   
 
For the fiscal year ended September 30, 2009

OR

o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
 
OF THE SECURITIES ACT OF 1934

Commission File Number: 000-53238
    
CEMTREX, INC.

(Exact name of registrant as specified in its charter)

Delaware
  
30-0399914
(State or other jurisdiction of
  
(IRS Employer Identification No.)
Incorporation or organization)
    

19 Engineers Lane,
Farmingdale, New York 11735
 (Address, including zip code, of principal executive offices)

631-756-9116
 (Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
 
Title of Each Class
  
Name of Each Exchange on Which Registered
Common Stock, $0.001 par value per share
    
 
Securities registered pursuant to Section 12(g) of the Act: None
 
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No x
 
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ¨ No x
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
     
Large accelerated filer ¨
  
Accelerated filer ¨
     
Non-accelerated filer ¨
  
Smaller reporting company x
(Do not check if a smaller reporting company)
    
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x
 
As of January 8, 2010, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was $4,253,990 based on the average bid and asked price of $0.43 on January 8, 2010.

As of January 8, 2010, the registrant had 39,722,862 shares of common stock outstanding.

Documents incorporated by reference: None. 

 
DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference, briefly describe them and identify the part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) any annual report to security holders; (2) any proxy or information statement, and (3) any prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933 (“Securities Act”). The listed documents should be clearly described for identification purposes: None

EXPLANATORY NOTE

This Amendment No. 1 on Form 10-K/A (the “Amendment”) amends the Annual Report on Form 10-K of Cemtrex, Inc. for the fiscal year ended September 30, 2009, originally filed with the Securities and Exchange Commission (“SEC”) on January 13, 2010 (the “Original Filing”). We are filing this Amendment to amend Item 15 (a) Financial Statements to correct the inadvertent failure to include the audit opinion letter from the Independent Registered Public Accounting Firm within the Original Filing.  This Form 10-K/A does not attempt to modify or update any other disclosures set forth in the Original Filing, except as required to reflect the amended information in this Form 10-K/A. Additionally, this amended Form 10-K/A, except for the amended information, speaks as of the filing date of the Original Filing and does not update or discuss any other developments affecting us subsequent to the date of the Original Filing.

PART IV

ITEM 15.           EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 
(a)
Financial Statements

 
  F-1
     
Audited Consolidated Balance Sheets as of September 30, 2008 and September 30, 2009
  
F-2
     
Audited Consolidated Statements of Operations for the Year Ended September, 2008 and 2007
  
F-3
     
Audited Consolidated Statements of Stockholders’ Equity (Deficit) for the Years Ended September 30, 2009, and 2007
  
F-4
     
Audited Consolidated Statements of Cash Flows for the Year Ended September 30, 2009 and 2008
  
F-5
     
Notes to Audited Consolidated Financial Statements
  
  F-6
 
 
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
THE BOARD OF CEMTREX, INC.
 
We have audited the accompanying consolidated balance sheet of Cemtrex, Inc. and Subsidiary as of September 30, 2009 and 2008, and the related consolidated statements of operations, stockholders equity and cash flows for the periods then ended.  These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.
 
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform our audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
 
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Cemtrex, Inc. and Subsidiary at September 30, 2009 and 2008, and the results of its’ consolidated operations and its’ consolidated stockholders equity and consolidated cash flows for the periods then ended in conformity with accounting principles generally accepted in the United States of America.
 
 
/s/
 
Gruber & Company, LLC
 
Saint Louis, Missouri
 
January 11, 2010
 
 
F-1
 
 
Cemtrex, Inc. and Subsidiary
Consolidated Balance Sheets

   
September 30,
  
   
2009
    
2008
  
Assets
            
Current Assets
            
Cash & Equivalents
   $ 356,552     $ 60,610  
Accounts Receivable
     948,815       1,528,231  
Inventory
     334,102       456,567  
Prepaid Expenses & Other Assets
     14,650       8,100  
Total Current Assets
     1,654,119       2,053,508  
                 
Property & Equipment, Net
     85,138       180,519  
Other
     4,225       4,225  
                 
Total Assets
   $ 1,743,482     $ 2,238,252  
                 
Liabilities & Stockholders' Equity (Deficit)
                
Current Liabilities
                
Accounts Payable
   $ 876,799     $ 940,071  
Accrued Expenses
     387,877       906,259  
Notes Payable-Shareholder
     -       467,171  
Total Current Liabilities
     1,264,676       2,313,501  
                 
Non-Current Liabilities
                
Notes Payable-Shareholder
     390,520       -  
Convertible Debenture
     -       1,300,000  
Total Non-Current Liabilities
     390,520       1,300,000  
                 
Total Liabilities
   $ 1,655,196     $ 3,613,501  
                 
Commitments & Contingencies
     -       -  
                 
Stockholders' Equity (Deficit)
                
Preferred Stock Series A, $0.001 par value, 10,000,000 shares authorized, 1,000,000 shares issued and outstanding, respectively
   $ 1,000     $ -  
Common Stock, $0.001 par value, 60,000,000 shares authorized, authorized; 39,722,862 and 34,327,862 shares issued and outstanding, respectively
     39,723       34,328  
Additional Paid-in Capital
     42,606       (1,259,524 )
Retained Earnings (Accumulated Deficit)
     4,957       (150,053 )
Total Stockholders' Equity (Deficit)
     88,286       (1,375,249 )
                 
Total Liabilities & Stockholders' Equity (Deficit)
   $ 1,743,482     $ 2,238,252  

The accompanying notes are an integral part of these financial statements

 
F-2
 

Cemtrex, Inc. and Subsidiary
Consolidated Statements of Operations

   
For the Twelve Months Ended
  
   
September 30,
  
   
2009
    
2008
  
             
Revenues
   $ 6,967,992     $ 6,670,053  
                 
Cost of Goods Sold
     4,067,677       4,039,810  
                 
Gross Profit
     2,900,315       2,630,243  
                 
Operating Expenses
                
Research and Development
     5,535       -  
General and Administrative
     2,628,536       2,384,843  
Total Operating Expenses
     2,634,071       2,384,843  
                 
Operating Income (Loss)
     266,244       245,400  
                 
Other Income (Expense)
                
Other Income
     -       36  
Interest Expense
     (107,789 )     (127,358 )
Total Other  Income (Expense)
     (107,789 )     (127,322 )
                 
Net Income (Loss) Before Income Taxes
     158,455       118,078  
                 
Provision for Income Taxes
     (3,445 )     -  
                 
Net Income (Loss)
   $ 155,010     $ 118,078  
                 
Income (Loss) Per Share-Basic
   $ 0.00     $ 0.00  
Income (Loss) Per Share-Diluted
   $ 0.00     $ 0.00  
                 
Weighted Average Number of Shares-Basic
     36,397,337       30,308,147  
Weighted Average Number of Shares-Diluted
     37,397,337       30,308,148  

The accompanying notes are an integral part of these financial statements

 
F-3
 

Cemtrex, Inc. and Subsidiary
Consolidated Statements of Cash Flows

   
For the Twelve Months Ended
  
   
September 30,
  
   
2009
    
2008
  
Cash Flows from Operating Activities
            
Net Income (Loss)
   $ 155,010     $ 118,078  
                 
Adjustments to reconcile net loss to net cash used in operating activities:
                
Depreciation & Amortization
     33,296       33,143  
                 
Changes in operating assets and liabilities:
                
Accounts Receivable
     579,416       (747,757 )
Inventory
     122,465       (204,124 )
Prepaid Expenses & Other Assets
     (6,550 )     (3,875 )
Other Assets
     -       17,799  
Accounts Payable
     8,970       25,164  
Accrued Expenses
     (518,382 )     457,619  
Customer Deposits
     -       (85,516 )
                 
Net Cash Used in Operating Activities
     374,225       (389,469 )
                 
Cash Flows from Investing Activities
                
Purchase of Property and Equipment
     (10,157 )     (151,939 )
                 
Net Cash Used in Investing Activities
     (10,157 )     (151,939 )
                 
Cash Flows from Financing Activities
                
Net Loans from Shareholders
     (76,651 )     458,188  
Common Stock Issued for Cash
     8,525       -  
                 
Net Cash Provided by Financing Activities
     (68,126 )     458,188  
                 
Net Increase (Decrease) in Cash
     295,942       (83,220 )
                 
Cash Beginning of Period
     60,610       143,830  
                 
Cash End of Period
   $ 356,552     $ 60,610  
                 
Supplemental Disclosure of Cash Flow Information:
                
Cash Paid during the period for interest
   $ -     $ -  
Cash Paid during the period for income taxes
     -       -  
                 
Supplemental Disclosure of Non-Cash Items:
                
Shares Issued for Conversion of Convertible Debt
   $ 1,300,000     $ -  
Equipment Sold in Exchange for Reduction in Accounts Payable
     72,242       -  

The accompanying notes are an integral part of these financial statements

 
F-4
 

Cemtrex, Inc. and Subsidiary
Consolidated Statements of Stockholders' Equity (Deficit)

 
 
Preferred Stock-Series A
    
Common Stock
                    
   
Number of
Shares
    
Par Value
($0.001) Amount
    
Number of
Shares
    
Par Value
($0.001) Amount
    
Additional Paid-In-
Capital
    
Retained
Earnings
(Accumulated
Deficit)
    
Total
Stockholders'
Equity (Deficit)
  
Balance at September 30, 2007
     -     $ -       34,327,862     $ 34,328     $ (1,259,524 )   $ (268,131 )   $ (1,493,327 )
Net Income
     -       -       -       -       -       118,078       118,078  
Balance at September 30, 2008
     -     $ -       34,327,862     $ 34,328     $ (1,259,524 )   $ (150,053 )   $ (1,375,249 )
Shares Issued for Conversion of Convertible Debt
     1,000,000       1,000       2,500,000       2,500       1,296,500       -       1,300,000  
Shares Issued for Cash
     -       -       2,895,000       2,895       5,630       -       8,525  
Net Income
     -       -       -       -       -       155,010       155,010  
Balance at September 30, 2009
     1,000,000     $ 1,000       39,722,862     $ 39,723     $ 42,606     $ 4,957     $ 88,286  

The accompanying notes are an integral part of these financial statements

 
F-5
 
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 

 
Note 1 – Organization, Business & Operations
 
Cemtrex, Inc. and its wholly-owned subsidiary Griffin Filters, LLC (collectively the “Company”), is engaged in manufacturing and selling the most advanced instruments for emission monitoring of particulate, opacity, mercury, sulfur dioxide, nitrogen oxides, etc. Cemtrex also provides turnkey services for carbon creation projects from abatement of greenhouse gases pursuant to Kyoto protocol and assists project owners in selling of carbon credits globally. Company's products are sold to power plants, refineries, chemical plants, cement plants & other industries including federal and state governmental agencies. Through its wholly-owned subsidiary, Griffin Filters, the Company designs, manufactures and sells air filtration equipment and systems to control particulate emissions in a variety of industries.
 
Cemtrex, Inc. was incorporated as Diversified American Holding, Inc. on April 27, 1998. On December 16, 2004, the Company changed its name to Cemtrex, Inc. On April 30, 2007, Cemtrex, Inc. acquired Griffin Filters, LLC (see Note 5 – Business Combination and Related Party Transactions).
 
Note 2 - Summary of Significant Accounting Policies
 
Principles of Consolidation
 
The accompanying consolidated financial statements include the accounts of Cemtrex, Inc. and its wholly subsidiary Griffin Filters, LLC (collectively the “Company”). All significant inter-company accounts and transactions have been eliminated in consolidation.
 
The acquisition of Griffin Filters, LLC by Cemtrex, Inc. was treated as a business combination due to the fact that the acquired entity and purchased entity were owned by the same individual. Therefore, these consolidated financial statements have been retrospectively adjusted for all periods presented.
 
Accounting Method
 
The Company’s financial statements are prepared using the accrual method of accounting. The Company has elected a September 30 year-end.
 
Cash and cash equivalents
 
The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.
 
Concentrations of Credit Risk - Cash
 
The Company maintains its cash with various financial institutions, which may exceed federally insured limits throughout the period.
 
Inventories
 
Inventories are comprised of replacement parts, system components and finished systems, which are stated at lower of cost or market. Cost is determined on a first-in, first-out (FIFO) basis.
 
Property and Equipment
 
Property and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives, generally five to seven years. Leasehold improvements are amortized over the shorter of the useful life or the remaining lease term. Upon retirement or other disposition of these assets, the cost and related accumulated depreciation are removed from the accounts and the resulting gains or losses are reflected in operations. Expenditures for maintenance and repairs are charged to operations as incurred. Renewals and betterments are capitalized.
 
Impairment of long-lived asset
 
The Company reviews its long-lived assets and identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. When such factors and circumstances exist, management compares the projected undiscounted future cash flows associated with the future use and disposal of the related asset or group of assets to their respective carrying values. Impairment, if any, is measured as the excess of the carrying value over the fair value, based on market value when available, or discounted expected cash flows, of those assets and is recorded in the period in which the determination is made. During fiscal years ended September 30, 2009 and 2008, the Company recorded $0 impairment loss on long-lived assets.
 
F-6
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 
 
Basic and Diluted Net Income per Share
 
Basic earnings per share is calculated using the weighted-average number of common shares outstanding during the period without consideration of the dilutive effect of stock warrants and convertible notes. Diluted earnings per share is calculated using the weighted-average number of common shares outstanding during the period after consideration of the dilutive effect of stock warrants and convertible notes.
 
Revenue recognition
 
Sales of products and related costs of products sold are recognized when (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred, (iii) the price is fixed or determinable and (iv) collectability is reasonably assured. These terms are typically met upon shipment of finished goods to the customer.
 
Allowance for doubtful accounts
 
We provide an allowance for estimated uncollectible accounts receivable balances based on historical experience and the aging of the related accounts receivable. As of September 30, 2009 and 2008, the Company has reserved $200,000 for doubtful accounts.
 
Advertising
 
The Company expenses advertising costs as incurred. The Company incurred $47,352 and $0 in advertising costs for the years ended September 30, 2009 and 2008, respectively.
 
Income Taxes
 
The Company accounts for income taxes under the provisions of FASB ASC 740, “Income Taxes”, formerly referenced as SFAS No. 109, “Accounting for Income Taxes”. Under the provisions of FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between their financial statement carrying values and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
 
Significant judgment is required in determining any valuation allowance recorded against deferred tax assets. In assessing the need for a valuation allowance, the Company considers all available evidence including past operating results, estimates of future taxable income, and the feasibility of tax planning strategies. In the event that the Company changes its determination as to the amount of deferred tax assets that can be realized, the Company will adjust its valuation allowance with a corresponding impact to the provision for income taxes in the period in which such determination is made.
 
F-7
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
   
September 30,
  
   
2009
    
2008
  
Current Taxes
            
U.S. Federal
   $ 53,875     $ -  
U.S. State and Local
     11,092       -  
Current Taxes
     64,967       -  
Deferred Tax Asset
     (61,522 )     61,522  
Deferred Tax Valuation Allowance
     -       (61,522 )
Provision for Income Taxes
   $ 3,445     $ -  
 
   
September 30,
  
   
2009
    
2008
  
Statutory Federal Tax (Benefit) Rate
     34.0 %     34.0 %
Statutory State Tax (Benefit) Rate
     7.0 %     7.0 %
Effective Tax (Benefit) Rate
     41.0 %     41.0 %
                 
Valuation Allowance
     -38.8 %     -41.0 %
                 
Effective Income Tax
     2.2 %     0.0 %
 
 
Guarantee Expense
 
In accordance with FASB Interpretation No. 45 ("Fin 45"), the Company recognizes, at the inception of a guarantee, the cost of the fair value of the obligation undertaken in issuing the guarantee.
 
Research and development costs
 
Expenditures for research & development are expenses as incurred. Such costs are required to be expensed until the point that technological feasibility is established. The Company incurred $5,535 and $0 research and development costs for the years ended September 30, 2009 and 2008, respectively which were expensed.
 
Fair Value of Financial Instruments
 
The reported amounts of the Company's financial instruments, including accounts payable and accrued liabilities, approximate their fair value due to their short maturities. The carrying amounts of debt approximate fair value since the debt agreements provide for interest rates that approximate market.
 
Stock-based compensation
 
The Company records compensation expense associated with stock options and other forms of employee and non-employee equity compensation in accordance with FASB ASC 718, “Compensation – Stock Compensation”, formerly referenced as SFAS 123R, “Share-Based Payment”. The Company estimates the fair value of stock options granted using the Black-Scholes-Merton option-pricing formula and a single option approach. This fair value is then amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period.
 
During fiscal years ended September 30, 2009 and 2008, the Company incurred $0 in stock-based compensation expense.
 
Reclassifications
 
Certain items in the prior year financial statements have been reclassified for comparative purposes to conform to the presentation in the current period’s presentation. These reclassifications have no effect on the previously reported income (loss).
 
F-8
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
Recently Issued Accounting Pronouncements
 
The adoption of these accounting standards had the following impact on the Company’s statements of income and financial condition:
 
·     
FASB ASC Topic 855, “Subsequent Events”. In May 2009, the FASB issued FASB ASC Topic 855, which establishes general standards of accounting and disclosure of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. In particular, this Statement sets forth : (i) the period after the balance sheet date during which management of a reporting entity should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, (ii) the circumstances under which an entity should recognize events or transactions occurring after the balance sheet date in its financial statements, (iii) the disclosures that an entity should make about events or transactions that occurred after the balance sheet date. This FASB ASC Topic should be applied to the accounting and disclosure of subsequent events. This FASB ASC Topic does not apply to subsequent events or transactions that are within the scope of other applicable accounting standards that provide different guidance on the accounting treatment for subsequent events or transactions. This FASB ASC Topic was effective for interim and annual periods ending after June 15, 2009, which was June 30, 2009 for the Corporation. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures.
 
·     
FASB ASC Topic 105, “The FASB Accounting Standard Codification and the Hierarchy of Generally Accepted Accounting Principles”. In June 2009, the FASB issued FASB ASC Topic 105, which became the source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the SEC under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this FASB ASC Topic, the Codification will supersede all then-existing non-SEC accounting and reporting standards. All other non-SEC accounting literature not included in the Codification will become non-authoritative. This FASB ASC Topic identify the sources of accounting principles and the framework for selecting the principles used in preparing the financial statements of nongovernmental entities that are presented in conformity with GAAP. Also, arranged these sources of GAAP in a hierarchy for users to apply accordingly. In other words, the GAAP hierarchy will be modified to include only two levels of GAAP: authoritative and non-authoritative. This FASB ASC Topic is effective for financial statements issued for interim and annual periods ending after September 15, 2009. The adoption of this topic did not have a material impact on the Company’s disclosure of the financial statements
 
·     
FASB ASC Topic 320, “Recognition and Presentation of Other-Than-Temporary Impairments”. In April 2009, the FASB issued FASB ASC Topic 320 amends the other-than-temporary impairment guidance in GAAP for debt securities to make the guidance more operational and to improve the presentation and disclosure of other-than-temporary impairments on debt and equity securities in the financial statements. This FASB ASC Topic does not amend existing recognition and measurement guidance related to other-than-temporary impairments of equity securities. The FASB ASC Topic shall be effective for interim and annual reporting periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009. Earlier adoption for periods ending before March 15, 2009, is not permitted. This FASB ASC Topic does not require disclosures for earlier periods presented for comparative purposes at initial adoption. In periods after initial adoption, this FASB ASC Topic requires comparative disclosures only for periods ending after initial adoption. The adoption of this Topic did not have a material impact on the Company’s financial statements and disclosures.
 
The Company is evaluating the impact that the following recently issued accounting pronouncements may have on its financial statements and disclosures.
 
·     
FASB ASC Topic 860, “Accounting for Transfer of Financial Asset”., In June 2009, the FASB issued additional guidance under FASB ASC Topic 860, “Accounting for Transfer and Servicing of Financial Assets and Extinguishment of Liabilities", which improves the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor’s continuing involvement, if any, in transferred financial assets. The Board undertook this project to address (i) practices that have developed since the issuance of FASB ASC Topic 860, that are not consistent with the original intent and key requirements of that statement and (ii) concerns of financial statement users that many of the financial assets (and related obligations) that have been derecognized should continue to be reported in the financial statements of transferors. This additional guidance requires that a transferor recognize and initially measure at fair value all assets obtained (including a transferor’s beneficial interest) and liabilities incurred as a result of a transfer of financial assets accounted for as a sale. Enhanced disclosures are required to provide financial statement users with greater transparency about transfers of financial assets and a transferor’s continuing involvement with transferred financial assets. This additional guidance must be applied as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter. Earlier application is prohibited. This additional guidance must be applied to transfers occurring on or after the effective date.
 
F-9
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
·     
FASB ASC Topic 810, “Variables Interest Entities”. In June 2009, the FASB issued FASB ASC Topic 810, which requires an enterprise to perform an analysis to determine whether the enterprise’s variable interest or interests give it a controlling financial interest in a variable interest entity. This analysis identifies the primary beneficiary of a variable interest entity as the enterprise that has both of the following characteristics: (i)The power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance and (ii)The obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. Additionally, an enterprise is required to assess whether it has an implicit financial responsibility to ensure that a variable interest entity operates as designed when determining whether it has the power to direct the activities of the variable interest entity that most significantly impact the entity’s economic performance. This FASB Topic requires ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity and eliminate the quantitative approach previously required for determining the primary beneficiary of a variable interest entity, which was based on determining which enterprise absorbs the majority of the entity’s expected losses, receives a majority of the entity’s expected residual returns, or both. This FASB ASC Topic shall be effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited.
 
·     
FASB ASC Topic 820, “Fair Value measurement and Disclosures”, an Accounting Standard Update. In September 2009, the FASB issued this Update to amendments to Subtopic 82010, “Fair Value Measurements and Disclosures”. Overall, for the fair value measurement of investments in certain entities that calculates net asset value per share (or its equivalent). The amendments in this Update permit, as a practical expedient, a reporting entity to measure the fair value of an investment that is within the scope of the amendments in this Update on the basis of the net asset value per share of the investment (or its equivalent) if the net asset value of the investment (or its equivalent) is calculated in a manner consistent with the measurement principles of Topic 946 as of the reporting entity’s measurement date, including measurement of all or substantially all of the underlying investments of the investee in accordance with Topic 820. The amendments in this Update also require disclosures by major category of investment about the attributes of investments within the scope of the amendments in this Update, such as the nature of any restrictions on the investor’s ability to redeem its investments at the measurement date, any unfunded commitments (for example, a contractual commitment by the investor to invest a specified amount of additional capital at a future date to fund investments that will be made by the investee), and the investment strategies of the investees. The major category of investment is required to be determined on the basis of the nature and risks of the investment in a manner consistent with the guidance for major security types in GAAP on investments in debt and equity securities in paragraph 320-10-50-lB. The disclosures are required for all investments within the scope of the amendments in this Update regardless of whether the fair value of the investment is measured using the practical expedient. The amendments in this Update apply to all reporting entities that hold an investment that is required or permitted to be measured or disclosed at fair value on a recurring or non recurring basis and, as of the reporting entity’s measurement date, if the investment meets certain criteria The amendments in this Update are effective for the interim and annual periods ending after December 15, 2009. Early application is permitted in financial statements for earlier interim and annual periods that have not been issued.
 
F-10
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
·     
FASB ASC Topic 740, “Income Taxes”, an Accounting Standard Update. In September 2009, the FASB issued this Update to address the need for additional implementation guidance on accounting for uncertainty in income taxes. The guidance answers the following questions: (i) Is the income tax paid by the entity attributable to the entity or its owners? (ii) What constitutes a tax position for a pass-through entity or a tax-exempt not-for-profit entity? (iii) How should accounting for uncertainty in income taxes be applied when a group of related entities comprise both taxable and nontaxable entities? In addition, this Updated decided to eliminate the disclosures required by paragraph 740-10-50-15(a) through (b) for nonpublic entities. The implementation guidance will apply to financial statements of nongovernmental entities that are presented in conformity with GAAP. The disclosure amendments will apply only to nonpublic entities as defined in Section 740-10-20. For entities that are currently applying the standards for accounting for uncertainty in income taxes, the guidance and disclosure amendments are effective for financial statements issued for interim and annual periods ending after September 15, 2009.
 
Note 3 - Inventory
 
The Company values its inventory under the FIFO method of costing under the lower of cost or market pricing model. The Company reviews its product for old and or obsolete items and adjusts accordingly. The Company’s inventory consists of finished and raw material product.
 
Note 4 - Property and Equipment
 
At September 30, 2009 and September 30, 2008, property and equipment are comprised of the following:
 
   
September 30,
  
   
2009
    
2008
  
Furniture and Office Equipment
   $ 97,611     $ 96,513  
Computer Software
     13,609       4,550  
Machinery and Equipment
     68,942       151,939  
                 
Less: Accumulated Depreciation
     (95,024 )     (72,483 )
                 
Net Property & Equipment
   $ 85,138     $ 180,519  
 
Depreciation for the twelve months ended September 30, 2009 and 2008 was $33,296 and $33,143, respectively.
 
Note 5 – Business Combination and Related Party Transactions
 
On April 30, 2007, the Company purchased, though a business combination, all of the issued and outstanding membership interests of Griffin Filters LLC, (“Griffin”) a company established since 1971 and engaged in the design, engineering & supplying of industrial air filtration equipment from its President. Aron Govil, the Chairman, Chief Executive Officer, Treasurer and President of the Company, was the owner of 100% of the issued and outstanding membership interests of Griffin. The Company purchased 100% ownership in Griffin for a purchase price of $2,750,000.00. The Company completed the Griffin purchase by (i) paying cash of $700,000; (ii) issuing 20,000,000 shares of common stock valued at $750,000; and (iii) issuing a four year convertible debenture in the amount of $1,300,000 (see Note 7). Griffin had sales and net income of $3,297,409 and $145,981 respectively for fiscal year ended September 30, 2006. Griffin is now a wholly-owned subsidiary of the Company.
 
The Company recorded the combination of Griffin Filters, LLC as a “As is Pooling” because of the related party interest as follows:
 
F-11
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
Accounts Receivable
   $ 530,506  
Inventory
     49,668  
Property & Equipment, Net
     67,018  
Other Assets
     4,225  
Accounts Payable
     (600,348 )
Additional Paid-in-Capital
     2,698,931  
Total
   $ 2,750,000  
 
These consolidated financial statements have been retrospectively adjusted for all periods presented.
 
In addition, the Company had the following related party transactions:
 
·     
The Company sold to Ducon Technologies India product totaling $450,000. Ducon is an enterprise owned by the majority stockholder of the Company.
 
·     
The Company leases space from Ducon Technologies, a related party, on a month to month basis.
 
Note 6 – Note Payable Shareholder
 
A Note Payable to a shareholder totaling $390,520 is due October 1, 2011 and accrues interest at 5% per annum.
 
Note 7 – Convertible Debenture
 
On September 8th, 2009, Cemtrex, Inc. entered into a letter agreement with Arun Govil, the Chairman, Chief Executive Officer, Treasurer and President of the Company. Pursuant to the letter agreement Arun Govil agreed to cancel the convertible promissory note, held by him, dated April 30, 2007.  The principal balance of the Note was $1,300,000. Pursuant to the terms of the Note, the Outstanding Amount was convertible into 30,000,000 shares of the Company’s common stock. Pursuant to the letter agreement, in return for cancelling the Note, the Company issued Arun Govil 2,500,000 shares of common stock of the Company, par value $0.001 and 1,000,000 shares of Series A Preferred Stock of the Company, par value $0.001 per share. Mr. Govil agreed to forfeit 27,500,000 shares of common stock issuable as per the original terms of the Note.
 
Note 8– Stockholders’ Equity
 
Series A Preferred Stock
 
The Company is authorized to issue 10,000,000 shares of Series A Preferred Stock, $0.001 par value. As of September 30, 2009 and September 30, 2008, there were 1,000,000 and 0 shares issued and outstanding, respectively.
 
Each issued and outstanding Series A Preferred Share shall be entitled to the number of votes equal to the result of: (i) the number of shares of common stock of the Company issued and outstanding at the time of such vote multiplied by 1.01; divided by (ii) the total number of Series A Preferred Shares issued and outstanding at the time of such vote, at each meeting of shareholders of the Company with respect to any and all matters presented to the shareholders of the Company for their action or consideration, including the election of directors. Holders of Series A Preferred Shares shall vote together with the holders of Common Shares as a single class.
 
On September 8th , 2009, the Company issued 1,000,000 Series A Preferred Shares to Arun Govil, the Chairman, Chief Executive Officer, Treasurer and President of the Company, in conjunction with the of the conversion of a convertible note (see Note 7).
 
Common Stock
 
The Company is authorized to issue 60,000,000 shares of common stock, $0.001 par value. As of September 30, 2009 and 2008, there were 39,722,862 and 34,327,862 shares issued and outstanding, respectively.
 
On September 8th , 2009, the Company issued 2,500,000 common shares to Arun Govil, the Chairman, Chief Executive Officer, Treasurer and President of the Company, in conjunction with the of the conversion of a convertible note (see Note 7).  In addition, the Company issued 2,895,000 common shares for cash totaling $8,525.
 
F-12
 
Cemtrex Inc. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 
 
Note 10 – Commitments & Contingencies
 
Lease Obligations
 
The Company leases its principal office at Farmingdale, New York, 4000 square feet of office and warehouse/shop space in a single story commercial structure on a month to month lease from Ducon Technologies Inc., at a monthly rental of $2,157.
 
The Company’s subsidiary Griffin Filters LLC leases approx. 10,000 sq. ft. of office and warehouse space in Liverpool, New York from a third party in a five year lease at a monthly rent of $4,225 expiring on March 31, 2012.
 
Legal Proceedings
 
The Company is not currently involved in any lawsuits or litigation.
 
Note 11 - Subsequent Events
 
The Company has evaluated all subsequent events through January 11, 2010, the date this Annual Report on Form 10-K was filed with the SEC. There were no recognized or unrecognized events requiring disclosure as significant subsequent events.
 
F-13
 
(b)
Exhibit Index
 
Exhibit Number
  
Description of Exhibit
3.1
  
Certificate of Incorporation of the Company*
3.2
  
By Laws of the Company*
3.3
  
Certificate of Amendment of Certificate of Incorporation dated September 29, 2006*
3.4
  
Certificate of Amendment of Certificate of Incorporation dated March 30, 2007*
3.5
  
Certificate of Amendment of Certificate of Incorporation dated May 16, 2007*
3.6
  
Certificate of Amendment of Certificate of Incorporation dated August 21, 2007*
3.7
  
Certificate of Designation of the Series A Preferred Stock dated September 8, 2009**
10.1
  
Cemtrex Lease Agreement-Ducon Technologies, Inc.*
10.2
  
Lease Agreement between Daniel L. Canino and Griffin Filters, LLC*
10.3
  
Asset Purchase Agreement between Ducon Technologies, Inc. and Cemtrex Inc.*
10.4
  
Agreement and Assignment of Membership Interests between Arun Govil and Cemtrex, Inc.*
10.5
  
8.0% Convertible Subordinated Debenture*
10.6
  
Letter Agreement by and between the Company and Arun Govil, the Chairman, Chief Executive Officer, Treasurer and President of the Company dated September 8, 2009**
21.1
  
Subsidiaries*
23.1
  
Consent of Independent Registered Public Accounting Firm.***
31.1
  
Certification by CEO pursuant to Sections 302 of the Sarbanes-Oxley Act of 2002 ***
31.2
  
Certification by Vice President of Finance pursuant to Sections 302 of the Sarbanes-Oxley Act of 2002***
32.1
  
Certification of CEO pursuant to Section 906 of the Sarbanes-Oxley Act of 2002***
32.2
  
Certification Vice President of Finance pursuant to Section 906 of the Sarbanes-Oxley Act of 2002***
______
   
* Incorporated by reference from Form 10-12G filed on May 22, 2008
** Incorporated by reference from Form 8-K filed on September 10, 2009
 *** Filed Herewith

 
 
 

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 
CEMTREX, INC.
  
 
(Registrant)
     
Dated: January 22, 2010
  
By
/s/ Arun Govil
     
Arun Govil, Chairman of the Board, Chief Executive Officer and President (Principal Executive Officer)
     
Dated: January 22, 2009
  
By
/s/ Renato Dela Rama
     
Renato Dela Rama, Vice President of Finance  (Principal Financial Officer)
       
Dated: January 22, 2009
  
By
/s/ Ravi Narayan
     
Ravi Narayan, Vice President of MIP Division and Director
       
Dated: January 22, 2009
  
By
/s/ Metodi Filipov
     
Metodi Filipov, Secretary and Director