CommandCenter Will Restate Previously Issued Financial Statements for 2010
CommandCenterWill Restate Previously Issued Financial Statements for 2010 and the First Three Quarters of 2011
Command Center, Inc. a national provider of on-demand and temporary staffing solutions, today announced that the Company's Audit Committee in consultation with its outside auditors, concluded that the Company's financial statements for 2010, and the interim periods ended April 1, 2011, July 1, 2011, and September 30, 2011 should no longer be relied upon. The Company will restate the financial statements described above to correct an overstatement of prepaid insurance policy deposits.
The details of the restatement are described in the Form 8-K filed today. According to Glenn Welstad, Command Center’s Chairman and CEO, the restatements were deemed necessary when the company discovered that a material discrepancy existed between premium payments and collateral deposits paid to insurance brokers in 2006-2008 to cover future workers’ compensation claims and the actual amounts received by the insurer, AIG Insurance. “The restatement does not reflect any trends in Command’s business or any current or prospective impact on the company's results of operations nor does it impact compliance with our debt covenants.”
As a result of the restatement, the accumulated deficit for the period ended December 31, 2010 increased by $716,000 from the reported amount. The restatement will not affect earnings per share for 2010 but will affect earnings per share for the third quarter of 2011. The earnings per share for the third quarter of 2011 is expected to increase by approximately $0.01.
Mr. Welstad added that these changes are already included in the Form 10-K filed on April 9, 2012 and, consequently, the restatement does not affect the current Form 10-K.