dismissed EB-3 Case: Restaurant

PUBLIC COPY 
U.S. Department of Homeland Security 
20 Mass, N. W. Rm. A3000 
 . 
Washington, DC 20529 
U.S. Citizenship 
and Immigration 
PETITION: 
 Immigrant Petition for Alien Worker as an Other, Unskilled Worker Pursuant to 
203(b)(3) of the Immigration and Nationality Act, 8 U.S.C. 5 1 153(b)(3) 
ON BEHALF OF PETITIONER: 
INSTRUCTIONS: 
This is the decision of the Administrative Appeals Office in your case. All documents have been 
returned to the office that originally decided your case. Any further inquiry must be made to that 
office. 
Robert P. Wiemann, Chief 
Administrative Appeals Office 
Page 2 
DISCUSSION: The preference visa petition was denied by the Director, Vermont Service Center, and is 
now before the Administrative Appeals Office on appeal. The appeal will be dismissed. 
The petitioner is a restaurant/diner. It seeks to employ the beneficiary permanently in the United States as a 
cook. As required by statute, the petition is accompanied by a Form ETA 750, Application for Alien 
Employment Certification, approved by the U. S. Department of Labor. The director determined that the 
petitioner had not established that it had the continuing ability to pay the beneficiary the proffered wage 
beginning on the priority date of the visa petition. The director denied the petition accordingly. 
According to the petition, the petitioner's business was established in 1995, and, at the time the petition was 
prepared, the petitioner employed 37 individuals. 
Section 203(b)(3)(A)(iii) of the Immigration and Nationality Act (the Act), 8 U.S.C. 8 1153@)(3)(A)(iii), 
provides for the granting of preference classification to qualified immigrants who are capable, at the time of 
petitioning for classification under this paragraph, of performing unskilled labor, not of a temporary or 
seasonal nature for which qualified workers are unavailable. 
The regulation at 8 C.F.R. 4 204.5(g)(2) states in pertinent part: 
Ability of prospective enzployer to pay wage. Any petition filed by or for an employment 
based immigrant which requires an offer of employment must be accompanied by evidence 
that the prospective United States employer has the ability to pay the proffered wage. The 
petitioner must demonstrate this ability at the time the priority date 1s established and 
continuing until the beneficiary obtains lawful permanent residence. Evidence of this ability 
shall be in the form of copies of annual reports, federal tax returns, or audited financial 
statements. 
The regulation at 8 CFR 5 204.5(1)(3)(ii) states, in perhnent part: 
(A) General. Any requirements of training or experience for skilled workers, professionals, or 
other workers must be supported by letters fi-om trainers or employers giving the name, address, 
and title of the trainer or employer, and a description of the training received or the experience of 
the alien. 
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the priority 
date, which is the date the Form ETA 750 Application for Alien Employment Certification, was accepted for 
processing by any office within the employment system of the U.S. Department of Labor. The petitioner must 
also demonstrate that, on the priority date, the beneficiary had the qualifications stated on its Form ETA 750 
Application for Alien Employment Certification as certified by the U.S. Department of Labor and submitted with 
the instant petition. Matter of Wing's Tea House, 16 I&N Dec. 158 (Act. Reg. Cornrn. 1977). 
Here, the Form ETA 750 was accepted on April 25,2001.' The proffered wage as stated on the Form ETA 
750 is $12.00 per hour ($24,960.00) per year. Although the petitioner selected the check box selection on the 
It has been approximately five years since the Alien Employment Application has been accepted and the 
proffered wage established. According to the employer certification that is part of the application, ETA Form 
750 Part A, Section 23 b., states "The wage offered equals or exceeds the prevailing wage and I [the 
Page 3 
1-140 petition "Any other worker (requiring less than two years of training or experience)" the certified Form 
ETA 750 states that the position requires two years of experience. 
On appeal, counsel submits a legal statement and additional evidence. 
With the petition, counsel submitted copies of the following documents: the original Form ETA 750, 
Application for Alien Employment Certification, approved by the U.S. Department of Labor; a U.S. Internal 
Revenue Service Form tax return; and, copies of documentation concerning the beneficiary's qualifications as 
well as other documentation. 
Because the director determined, inter nlia, the evidence submitted with the petition was insufficient to 
demonstrate the petitioner's continuing ability to pay the proffered wage beginning on the priority date, 
consistent with 8 C.F.R. 5 204.5(g)(2), the director requested on May 2, 2005, pertinent evidence of the 
petitioner's ability to pay the proffered wage beginning on the priority date. 
The director requested evidence in the form of copies of annual reports (for the years 2001 through 2004), U.S. 
federal tax returns for 200 1,2002, and 2004, and audited or rcviewed financial staten~eiits. 
As the evidence in the record of proceeding stated that the petitioner employed the beneficiary since February of 
2001, the director requested that the petitioner provide copies of the beneficiary's W-2 Wage and Tax Statements 
for years 2001,2002,2002 and 2004. 
In response to the request for evidence, counsel submitted, iriter alia, copies of the following documents: the 
beneficiary's the petitioner's U.S. Internal Revenue Service (IRS) Form 1120 tax returns for years 2001, 2002 
and 2003. 
The director denied the petition on July 15,2005, finding that the evidence submitted did not establish that the 
petitioner had the continuing ability to pay the proffered wage beginning on the priority date.' 
Counsel has submitted the following documents to accompany the appeal statement: compiled financial 
statements for 200 1,2002 and 2003. 
In determining the petitioner's ability to pay the proffered wage during a given period, U.S. Citizenship and 
Immigration Services (CIS) will first examine whether the petitioner employed and paid the beneficiary 
during that period. If the petitioner establishes by documentary evidence that it employed the beneficiary at a 
salary equal to or greater than the proffered wage, the evidence will be considered prima facie proof of the 
petitioner's ability to pay the proffered wage. Statements was submitted to show that the petitioner employed 
the beneficiary and paid him in cash. No amounts were stated. 
Alternatively, in determining the petitioner's ability to pay the proffered wage, CIS will examine the net 
income figure reflected on the petitioner's federal income tax return, without consideration of depreciation or 
other expenses. Reliance on federal income tax returns as a basis for determining a petitioner's ability to pay 
employer] guarantee that, if a labor certification is granted, the wage paid to the alien when the alien begins 
work will equal or exceed the prevailing wage which is applicable at the time the alien begins work." 
In addition the director stated, "In addition, the statement regarding the beneficiary's work experience at the 
CoachJ3ouse is not clear regarding the beneficiary's duties in that position. This issue should be addressed in 
any future filings with this Service." 
Page 4 
the proffered wage is well established by judicial precedent. EEatos Restaurant Corp. v. Sava, 632 F.Supp. 
1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Hawaii, Ltd. v. Feldman, 736 F.2d 1305 , (9th Cir. 
1984) ); see also Chi-Feng Chang v. Tkornburgh, 71 9 F.Supp. 532 (N.D. Texas 1989); K.C.P. Food Co., Inc. 
v. Sava, 623 F.Supp. 1080 (S.D.N.Y. 1985); Ubeda v. Palmer, 539 F.Supp. 647 (N.D. Ill. 1982), afl'd, 703 
F.2d 571 (7th Cir. 1983). In K.C.P. Food Co., Inc. v. Sava, the court held that the Service had properly relied 
on the petitioner's net income figure, as stated on the petitioner's corporate income tax returns, rather than the 
petitioner's gross income. Supra at 1084. The court specifically rejected the argument that CIS should have 
considered income before expenses were paid rather than net income. Finally, no precedent exists that would 
allow the petitioner to "add back to net cash the depreciation expense charged for the year." Chi-Felfg Chang 
v. Tlzornburgh, Supra at 5 37. See also Elatos Restaurailt Corp. v. Sava, Sztpra at 1054. 
The tax returns demonstrated the following financial information concerning the petitioner's ability to pay the 
proffered wage of $24,960.00 per year from the priority date of April 2.5: 200 1 : 
In 2001, the Form 1120 stated taxable income3 of $42,070.00. 
* 
 In 2002, the Form 1120 stated taxable income of $901.00. 
In 2003, the Form 1120 stated no taxable income or loss of60.00. 
The petitioner's net current assets can be considered in the determination of the ability to pay the proffered 
wage especially when there is a failure of the petitioner to demonstrate that it has taxable income to pay the 
proffered wage. In the subject case, as set forth above, the petitioner did not have taxable income sufficient to 
pay the proffered wage at any time between the years 2002 through 2003 for which the petitioner's tax returns 
are offered for evidence. 
CIS will consider net current assets as an alternative method of demonstrating the ability to pay the proffered 
wage. Net current assets are the difference between the petitioner's current assets and current liabilitie~.~ A 
corporation's year-end current assets are shown on Schedule L, lines 1 through 6. That schedule is included 
with, as in this instance, the petitioner's filing of Form 1120 federal tax return. The petitioner's year-end 
current liabilities are shown on lines 16 through 18. If a corporation's end-of-year net current assets are equal 
to or greater than the proffered wage, the petitioner is expected to be able to pay the proffered wage. 
Examining the Form 1120 U.S. Income Tax Returns submitted by the petitioner, Schedule L found in each of 
those returns indicates the following: 
* 
 In 2001, petitioner's Form 1120 return stated current assets of $2,79?.005 and $9,678.00 in 
current liabilities. Therefore, the petitioner had approximately <$6,888.00>~ in net current 
assets. Since the proffered wage is $24,960.00, this sum is less than the proffered wage. 
IRS Form 1120, Line 28. 
4 
 According to Bawon 's Dictionary of Accounting Terms 117 (3d ed. 2000), "current assets" consist of items 
having (in most cases) a life of one year or less, such as cash, marketable securities, inventory and prepaid 
expenses. "Current liabilities" are obligations payable (in most cases) within one year, such as accounts 
payable, short-term notes payable, and accrued expenses (such as taxes and salaries). Id. at 1 18. 
A partial copy was provided with numerals deleted. 
The symbols <a number> indicate a negative number, or in the context of a tax return or other financial 
statement, a loss, that is below zero. 
- Page 5 
In 2002, petitioner's Form 1120 return stated current assets of $4,496.00 and $12,398.00 in 
current liabilities. Therefore, the petitioner had <$7,902.00> in net current assets. Since the 
proffered wage is $24,960.00, this sum is less than the proffered wage. 
In 2003, petitioner's Form 1120 return stated current assets of $2,687.00 and $10,753.00 in 
current liabilities. Therefore, the petitioner had <$8,066.00> in net current assets. Since the 
proffered wage is $24,960.00, this sum is less than the proffered wage. 
Therefore, for the period 2001 through 2003 from the date the Form ETA 750 was accepted for processing by 
the U. S. Department of Labor, the petitioner had not established that it had the ability to pay the beneficiary 
the proffered wage at the time of filing through an examination of its net current assets. 
Counsel asserts in his brief accompanying the appeal that there are other ways to deternine the petitioner's 
ability to pay the proffered wage from the priority date. According to regulation,7 copies of annual reports, 
federal tax returns, or audited financial statements are the means by which petitioner's ability to pay is 
determined. 
Counsel asserts that the petitioner had assets of over $7,902.00 in 2002, and in 2003, $8,06G.00. Counsel is in 
error in his statements. According to the above calculations the petitioner had <$6,888.00>, <$7,902.00>, 
and <$8,066.00> in net current assets in 2001,2002 and 2003 respectively. 
Counsel also asserts that the employer had assets of $76,121.00 in 2001, $64,020.00 in 2002, and $50,784.00 in 
2003 as taken from Schedule L, line 15. Line 15 is total assets on the return. Counsel then states that, therefore 
because of this, the petitioner had profits before depreciation. We reject the petitioner's assertion that the 
petitioner's total assets should have been considered in the determination of the ability to pay the proffered 
wage. The petitioner's total assets include depreciable assets that the petitioner uses in its business. Those 
depreciable assets will not be converted to cash during the ordinary course of business and will not, therefore, 
become funds available to pay the proffered wage. Further, the petitioner's total assets must be balanced by the 
petitioner's liabilities. Otherwise, they cannot properly be considered in the determination of the petitioner's 
ability to pay the proffered wage. 
There is established legal precedent against counsel's contention that depreciation may be a source to pay the 
proffered wage. The court in Chi-Feng Chang v. Thornburg, 719 F. Supp. 532 (N.D. Tex. 1989) noted: 
"Plaintiffs also contend that depreciation amounts on the 1985 and 1986 returns are non-cash 
deductions. Plaintiffs thus request that the court sua sponte add back to net cash the depreciation 
expense charged for the year. Plaintiffs cite no legal authority for this proposition. This argument 
has likewise been presented before and rejected. See Elatos, 632 F. Supp. at 1054. [CIS] and 
judicial precedent support the use of tax returns and the net income fzgures in determining 
petitioner's ability to pay. Plaintiffs' argument that these figures should be revised by the court by 
adding back depreciation is without support. (Original emphasis.) Chi-Feng at 537." 
As stated above, following established legal precedent, CIS relied on the petitioner's net income without 
consideration of any depreciation deductions, in its determinations of the ability to pay the proffered wage on 
and after the priority date. 
' 8 C.F.R. 8 204.5(g)(2). 
Page 6 
Counsel contends that the wages the petitioner paid in years 2001,2002 and 2003 are evidence of the ability 
to pay the proffered wage. The assertions of counsel do not constitute evidence. Matter of Obaigbena, 19 I&N 
Dec. 533,534 (BIA 1988); Matter of Ramirez-Sanchez, 17 I&N Dec. 503,506 (BIA 1980). Wages already paid 
to others are not available to prove the ability to pay the wage proffered to the beneficiary at the priority date of 
the petition and continuing to the present. 
Counsel submits compiled financial statements as proof of the ability to pay the proffered wage. A compilation 
is limited to presenting in the form of financial statements information that is the representation of 
management. An audit is conducted in accordance with generally accepted auditing standards to obtain 
reasonable assurance whether the financial statements of the business are free of material misstatement. A 
review is a financial statement between an audit and a compilation. Reviews are governed by the AICPA's 
(American Institute of Certified Public Accountants) Statement on Standards for Accounting and Review 
Services (SSARS) No.1. Accountants only express limited assurances in reviews. A compilation is the 
management's representation of its financial position. Evidence of the ability to pay shall be, inter crlia, in the 
form of copies of audited financial statements with a declaration of the maker indicating their manner of 
preparation and certifying the financial statements to be audited. Non-audited financials have limited 
evidenba~y weight in Service deliberations in these matters. The statements presented were not audited. 
The evidence submitted does not establish that the petitioner had the continuing ability to pay the proffered 
wage beginning on the priority date. 
Counsel's contentions cannot be concluded to outweigh the evidence presented in the corporate tax returns for 
2002 and 2003 as submitted by petitioner that shows that the petitioner has not demonstrated its ability to pay 
the proffered wage from the day the Form ETA 750 was accepted for processing by any office within the 
employment system of the Department of Labor. 
The burden of proof in these proceedings rests solely with the petitioner. Section 291 of the Act, 8 U.S.C. 
$ 1361. The petitioner has not met that burden. 
ORDER: The appeal is dismissed.