sustained EB-3 Case: Import-Export

identitying data deleted to 
prevent clearly unwarranted 
inv- d msl pdv~ey 
PUBLIC COPY 
U.S. Department of Ifomeland Security 
20 Mass. Ave., N.W., Rm. A3042 
Washington, DC 20529 
U.S. Citizenship 
and Immigration 
Services F< * 
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FILE: - Office: TEXAS SERVICE CENTER Date: HAY 0 4 2006 
SRC-03-117-52587 
PETITION: 
 Petition for Alien Worker as an Other Worker Pursuant to Section 203(b)(3) of the 
Immigration and Nationality Act, 8 U.S.C. 3 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 originall decided your case. Any further inquiry must be made to that office. 
mu 
Robert P. Wiemann, Chief 
Administrative Appeals Office 
Page 2 
DISCUSSION: The preference visa petition was denied by the Director, Texas Service Center, and is now 
before the Administrative Appeals Office (AAO) on appeal. The appeal will be sustained. The petition will 
be approved. 
The petitioner is an import-export retail and wholesale company. 
 It seeks to employ the beneficiary 
permanently in the United States as a sales representative. 
 As required by statute, a Form ETA 750, 
Application for Alien Employment Certification approved by the Department of Labor, accompanied the 
petition. 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 and denied the 
petition accordingly. 
Section 203(b)(3)(A)(iii) of the Immigration and Nationality Act (the Act), 8 U.S.C. fj 1153(b)(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 not available in the United States. 
The regulation at 8 C.F.R. fj 204.5(g)(2) states: 
Ability ofprospective employer 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 is established and continuing until the 
beneficiary obtains lawful permanent residence. Evidence of this ability shall be either in the 
form of copies of annual reports, federal tax returns, or audited financial statements. In a case 
where the prospective United States employer employs 100 or more workers, the director 
may accept a statement from a financial officer of the organization which establishes the 
prospective employer's ability to pay the proffered wage. In appropriate cases, additional 
evidence, such as profitlloss statements, bank account records, or personnel records, may be 
submitted by the petitioner or requested by [Citizenship and Immigration Services (CIS)]. 
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the petition's 
priority date, which is the date the Form ETA 750 was accepted for processing by any office within the 
employment system of the Department of Labor. See 8 C.F.R. fj 204.5(d). The priority date in the instant 
petition is April 27, 2001. The proffered wage as stated on the Form ETA 750 is $30,000.00 per year. On the 
Form ETA 750B, signed by the beneficiary on April 21, 2001, the beneficiary did not claim to have worked 
for the petitioner. The ETA 750 was certified by the Department of Labor on January 16,2003. 
The 1-140 petition was submitted on March 17, 2003. On the petition, the petitioner claimed to have been 
established on June 17, 1996, to currently have eleven employees, and to have a gross annual income of 
$1,006,276.00. 
 The item on the petition for net annual income was left blank. 
 With the petition, the 
petitioner submitted supporting evidence. 
In a request for evidence (WE) dated August 6, 2004, the director requested additional evidence relevant to 
the petitioner's continuing ability to pay the proffered wage beginning on the priority date. 
In response to the RFE, the petitioner submitted additional evidence. The petitioner's submissions in response 
to the RFE were received by the director on October 19, 2004. 
Page 3 
In a decision dated October 25,2004, the director determined that the evidence did not establish that the petitioner 
had the ability to pay the proffered wage as of the priority date and continuing until the beneficiary obtains lawful 
permanent residence, and denied the petition. 
The petitioner filed a Form I-290B Notice of Appeal on November 23, 2004. On that same day, the petitioner 
also filed a Motion to Reopen and Reconsider the director's decision of October 25, 2004. With the notice of 
appeal and the motion, the petitioner submitted additional evidence. 
In a decision dated December 16, 2004 the director denied the petitioner's Motion to Reopen and Reconsider. 
The director then transmitted the file to the AAO for consideration of the petitioner's notice of appeal. 
On appeal, counsel submits no brief, but counsel's analysis of the evidence and the law is found in the 
petitioner's Motion to Reopen and Reconsider. 
Counsel states on appeal that the petitioner's tax and financial documents establish the petitioner's ability to pay 
the proffered wage and that the petitioner has a solid history of operating a viable business, of having substantial 
assets and of meeting its salary obligations since 1996. Counsel also states that the petitioner's income dropped 
in 2001 as a result of the World Trade Center attacks of September 11, 2001 but that the petitioner's financial 
situation is expected to become positive in 2004. 
The submission of additional evidence on appeal is allowed by the instructions to the Form I-290B, which are 
incorporated into the regulations by the regulation at 8 C.F.R. 5 103.2(a)(l). The record in the instant case 
provides no reason to preclude consideration of any of the documents newly submitted on appeal. See Matter 
of Soriano, 19 I&N Dec. 764 (BIA 1988). 
The petitioner must establish that its job offer to the beneficiary is a realistic one. Because the filing of an 
ETA 750 labor certification application establishes a priority date for any immigrant petition later based on the 
ETA 750, the petitioner must establish that the job offer was realistic as of the priority date and that the offer 
remained realistic for each year thereafter, until the beneficiary obtains lawful permanent residence. The 
petitioner's ability to pay the proffered wage is an essential element in evaluating whether a job offer is realistic. 
See Matter of Great Wall, 16 I&N Dec. 142 (Acting Reg. Comm. 1977). See also 8 C.F.R. 5 204.5(g)(2). In 
evaluating whether a job offer is realistic, CIS requires the petitioner to demonstrate financial resources sufficient 
to pay the beneficiary's proffered wages, although the totality of the circumstances affecting the petitioning 
business will be considered if the evidence warrants such consideration. See Matter of Sonegawa, 12 I&N Dec. 
6 12 (Reg. Comm. 1967). 
In determining the petitioner's ability to pay the proffered wage, CIS will first examine whether the petitioner 
employed the beneficiary at the time the priority date was established. If the petitioner establishes by 
documentary evidence that it employed the beneficiary at a salary equal to or greater than the proffered wage, 
this evidence will be considered prima facie proof of the petitioner's ability to pay the proffered wage. In the 
instant case, on the Form ETA 750B, signed by the beneficiary on April 21,2001, the beneficiary did not claim to 
have worked for the petitioner. However, the record contains a copy of a Form W-2 Wage and Tax Statement of 
the beneficiary for 2003 showing compensation from the petitioner. The relationship of the beneficiary's actual 
compensation to the proffered wage is shown in the table below. 
Page 4 
Wage increase 
Beneficiary's actual needed to pay 
Year compensation Proffered wage the proffered wage. 
200 1 not submitted $30,000.00 $30,000.00 
2002 not submitted $30,000.00 $30,000.00 
2003 $9,680.00 $30,000.00 $20,320.00 
The above information is insufficient to establish the petitioner's ability to pay the proffered wage in any of 
the years at issue in the instant petition. 
As another means of determining the petitioner's ability to pay the proffered wage, CIS will next examine the 
petitioner's net income figure as reflected on the petitioner's federal income tax return for a given year, 
without consideration of depreciation or other expenses. Reliance on federal income tax returns as a basis for 
determining a petitioner's ability to pay the proffered wage is well established by judicial precedent. Elatos 
Restaurant Corp. v. Sava, 632 F. Supp. 1049, 1054 (S.D.N.Y. 1986) (citing Tongatapu Woodcraft Hawaii, Ltd. v. 
Feldman, 736 F.2d 1 305 (9th Cir. 1984)); see also Chi-Feng Chang v. Thornburgh, 7 19 F. Supp. 532 (N.D. Tex. 
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), am., 703 F.2d 57 1 (7'h Cir. 1983). In K.C.P. Food Co., Inc., the court held that the Immigration 
and Naturalization Service, now CIS, 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. 623 F. Supp. at 1084. The 
court specifically rejected the argument that the Service should have considered income before expenses were 
paid rather than net income. Finally, there is no precedent that would allow the petitioner to "add back to net cash 
the depreciation expense charged for the year." See Elatos Restaurant Corp., 632 F. Supp. at 1054. 
The evidence indicates that the petitioner is an S corporation. The record contains copies of the petitioner's Form 
1120s U.S. Income Tax Returns for an S Corporation for 1999, 2000, 2001, 2002 and 2003. The record before 
the director closed on October 19,2004 with the receipt by the director of the petitioner's submissions in response 
to the RFE. As of that date the petitioner's federal tax return for 2003 was the most recent return available. 
Where an S corporation's income is exclusively from a trade or business, CIS considers net income to be the 
figure for ordinary income, shown on line 21 of page one of the petitioner's Form I 120s. The instructions on the 
Form 1120s U.S. Income Tax Return for an S Corporation state on page one, "Caution: Include only trade or 
business income and expenses on lines la through 21." Where an S corporation has income from sources other 
than from a trade or business, that income is reported on Schedule K. An S corporation's total income from its 
various sources are reported on lines 1 through 6 of the Schedule K, Shareholders' Shares of Income, Credits, 
Deductions, etc. See Internal Revenue Service, Instructions for Form 1120s (2003), available at 
http://www.irs.gov/pub/irs-prior/i1120s--2003.pdf; Instructions for Form 1120s (2002), available at 
http://www.irs.gov/pub/irs-priorti 1 120s--2002.pdf. 
Similarly, some deductions appear only on the Schedule K. The cost of business property elected to be treated an 
expense deduction under Section 179 of the Internal Revenue Code, rather than as a depreciation deduction, is 
carried over from line 12 of the Form 4562 to line 8 of the Schedule K. See Internal Revenue Service, 
Instructions for Form 4562 (2003), at 1, available at http://www.irs.gov/pub/irs-prior/i4562--2003.pdf; Internal 
Revenue Service, Instructions for Form 1 120s (2003), at 22, available at http://www.irs.gov/pub/irs-prior/i1120s- 
-2003 .pdf. 
Where the Schedule K has relevant entries for either additional income or additional deductions, net income is 
found on Line 23 of the Schedule K, for income. 
In the instant petition, the petitioner's tax return for 1999 indicates a Section 179 deduction. Therefore the figure 
for ordinary income on line 21 of page one of the petitioner's Form 1120s tax return for that year does not 
include all of the petitioner's relevant deductions. For this reason, the petitioner's net income for 1999 is the 
figure on line 23 of the Schedule K, for income. For the other tax returns in the record, the Schedule K's show 
no additional income and no additional relevant deductions. Therefore for each of the other years the figure on 
line 21 for ordinary income is the same as the figure on line 23 of the Schedule K for income. The petitioner's 
tax returns state amounts for income on line 23 of Schedule K as shown in the table below. 
Tax Wage increase needed Surplus or 
year Net income to pay the proffered wage deficit 
1999 $83,069.00 not applicable not applicable 
2000 $20,703.00 not applicable not applicable 
200 1 -$16,873 .OO $30,000.00* -$46,873.00 
2002 -$144,930.00 $30,000.00* -$174,930.00 
2003 -$66,855.00 $20,320.00** -$87,175 .OO 
* The full proffered wage, since the record contains no evidence of any wage 
payments made by the petitioner to the beneficiary in 2001 or 2002. 
** Crediting the petitioner with the $9,680.00 actually paid to the beneficiary 
in 2003. 
The above information is insufficient to establish the petitioner's ability to pay the proffered wage in any of 
the years at issue in the instant petition. 
As an alternative means of determining the petitioner's ability to pay the proffered wages, CIS may review 
the petitioner's net current assets. Net current assets are a corporate taxpayer's current assets less its current 
liabilities. Current assets include cash on hand, inventories, and receivables expected to be converted to cash 
within one year. A corporation's current assets are shown on Schedule L, lines 1 through 6. Its current 
liabilities are shown on lines 16 through 18. If a corporation's net current assets are equal to or greater than 
the proffered wage, the petitioner is expected to be able to pay the proffered wage out of those net current 
assets. The net current assets are expected to be converted to cash as the proffered wage becomes due. Thus, 
the difference between current assets and current liabilities is the net current assets figure, which if greater 
than the proffered wage, evidences the petitioner's ability to pay. 
Calculations based on the Schedule L's attached to the petitioner's tax returns yield the amounts for year-end 
net current assets as shown in the following table. 
Page 6 
Tax 
year 
Net 
current Wage increase needed Surplus or 
assets to pay the proffered wage deficit 
1999 $162,667.00 not applicable not applicable 
2000 $148,705.00 not applicable not applicable 
200 1 $1 87,935.00 $30,000.00* $157,935.00 
2002 $82,174.00 $30,000.00* $52,174.00 
2003 $20,186.00 $20,320.00** -$134.00 
* The full proffered wage, since the record contains no evidence of any wage 
payments made by the petitioner to the beneficiary in 2001 or 2002. 
** Crediting the petitioner with the $9,680.00 actually paid to the beneficiary in 
2003. 
For 2001 and 2002, the petitioner's year-end net current assets are greater than the proffered wage. For 2003, 
the year-end net current assets are only $134.00 less than the wage increase needed to raise the beneficiary's 
actual compensation to the proffered wage. The foregoing information is sufficient to establish the 
petitioner's ability to pay the proffered wage as of the priority date and continuing until the beneficiary 
obtains lawful permanent residence. 
The record also contains copies of unaudited financial statements. Unaudited financial statements are not 
persuasive evidence. According to the plain language of 8 C.F.R. 5 204.5(g)(2), where the petitioner relies on 
financial statements as evidence of a petitioner's financial condition and of its ability to pay the proffered 
wage, those statements must be audited. Unaudited statements are the unsupported representations of 
management. The unsupported representations of management are not persuasive evidence of a petitioner's 
ability to pay the proffered wage. Therefore the unaudited financial statements in the record provide no 
additional support to help establish the petitioner's ability to pay the proffered wage. 
The record also contains copies of the petitioner's quarterly wage and withholding reports for 2001,2002, and 
2003, and for the first three quarters of 2004. The information on those reports appears to be consistent with 
the information on the petitioner's tax returns discussed above. 
For the foregoing reasons, the evidence establishes the petitioner's ability to pay the proffered wage as of the 
priority date and continuing until the beneficiary obtains lawful permanent residence. 
In her decision of October 25, 2004 denying the petition, the director correctly stated the petitioner's net 
income in 2001, of -$16,873.00. Since that figure is negative, the director found that it failed to establish the 
petitioner's ability to pay the proffered wage that year. In calculating the petitioner's net current assets, the 
director erroneously calculated net current liabilities as $294,056.00, rather than the correct figure of 
$59,277.00. The director erred in considering the figure of $234.779.00 for loans from shareholders as 
representing current liabilities. That figure appears on line 19 of the Schedule L for 200 1. However, current 
liabilities are listed only on lines 16, 17 and 18 of the Schedule L. The record contains no evidence indicating 
that the loans from shareholders on line 19 of the Schedule L for 2001 should be considered as current 
liabilities. 
The director correctly found that the beneficiary's Form W-2 for 2003 failed to establish the petitioner's 
ability to pay the proffered wage that year. 
In her October 25, 2004 decision, the director did not analyze the petitioner's tax returns for 2002 or 2003, 
since the director's findings regarding 2001 were considered to be sufficient reason to deny the petition. In 
her decision of December 16, 2004 denying the petitioner's Motion to Reopen and Reconsider, the director 
considered the petitioner's tax returns for 1999 and 2000, copies of which had been submitted for the first 
time with the motion and the notice of appeal. The director found that the information in the petitioner's tax 
returns for 1999 and 2000 was not directly relevant, since those years are before the year of the priority date. 
The director also found that the information in those returns provided no additional support to help establish 
the petitioner's ability to pay the proffered wage. 
For the reasons discussed above, the evidence in the record at the time of the director's decision of October 
25, 2004 was sufficient to establish the petitioner's ability to pay the proffered wage as of the priority date and 
continuing until the beneficiary obtains lawful permanent residence. Therefore the director's decision to deny 
the petition was incorrect, based on the evidence then in the record. 
The evidence newly submitted on appeal provides additional support for the conclusion that the evidence 
previously submitted is sufficient to establish the petitioner's ability to pay the proffered wage during the 
relevant period. The assertions of counsel on appeal and the evidence submitted on appeal therefore 
overcome the decision of the director. 
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 met that burden. 
ORDER: 
 The appeal is sustained. The petition is approved.