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News Breaks
August 19, 2014
16:22 EDTOFIXOrthofix plans to restate prior periods’ financial statements
As previously disclosed, Orthofix International has been evaluating the accounting treatment applied to certain entries included in the previous restatement of its prior periods’ financial results, as well as related entries in subsequent periods. As a result of this process, the company has determined that certain entries in its previously filed financial statements were not properly accounted for under U.S. generally accepted accounting principles. Specifically, the company has determined that a historical method of accounting for certain revenue adjustments as bad debt expense rather than as contra-revenue was incorrect. As a result of the foregoing, the company expects to reduce equally both its historical net sales and its sales and marketing expense by approximately $6M, $9M, $2M and $3M for the fiscal years ended December 31, 2011, 2012 and 2013 and the fiscal quarter ended March 31, 2014, respectively. These changes are expected to have no effect on pretax income from continuing operations in those periods. In addition, the company has determined that certain bad debt reserves originally recorded in 2011 and 2012 were reversed in incorrect periods during the previous restatement in connection with a change to sell-through accounting for certain distributors, intercompany profit in inventory was not fully eliminated in the subsidiary consolidation process, and the company classified approximately $0.5M of interest expense under continuing operations in 2012 but should have classified it under discontinued operations. As a result of these collective accounting errors, it is expected that pretax income from continuing operations will increase by approximately $2M or the fiscal year ended December 31, 2011, and will decrease by approximately $1M, $2.5M and $2.5M for the fiscal years ended December 31, 2012 and 2013 and the fiscal quarter ended March 31, 2014, respectively. In view of the foregoing corrections, the company has determined that it will restate its financial statements for the fiscal years ended December 31, 2011, 2012 and 2013 and the fiscal quarter ended March 31, and that the company’s previously filed financial statements for these periods should no longer be relied upon due to the anticipated corrections described above.
News For OFIX From The Last 14 Days
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October 20, 2014
07:12 EDTOFIXCongress of Neurological Surgeons to hold annual meeting
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