Staffing firm’s stock falls 33% after CFO misstated costs
Barrett Business Services has disclosed that it fired CFO James D. Miller after learning that he made “unsupported journal entries” in financial records during each calendar quarter of 2013.
The staffing solutions provider said in a regulatory filing on Wednesday that Miller notified its audit committee on 3rd March that he had overstated some costs by about $12m and understated its workers’ compensation expenses by roughly the same amount.
Barrett had previously disclosed in February it was considering whether restatement of financial statements for the quarters ended 30th June 2014, and 30th September 2014, may be required.
On Wednesday, it said the audit committee had determined the financial statements for fiscal 2012, 2013 and 2014 and the first half of 2015 “must be restated and should not be relied upon,” but the committee “believes that the improper journal entries had no effect on the company’s consolidated balance sheets or on income from operations, net income, or earnings per share for any quarterly period in fiscal 2013 or for the year ended December 31, 2013.”
Barrett’s stock fell 33% Thursday on the news, closing at $24. In trading Friday, it regained some ground, closing up 13% at $27.54.
In 2014, the company reported revenue of $636m and a $27m net loss, compared with revenue of $533m and a profit of nearly $18m the prior year. Miller joined Barrett as controller in 1994 and was appointed CFO in 2008.
To replace Miller, Barrett has named board member Thomas Carley as interim CFO.
Original story appeared on CFO magazine's website: http://ww2.cfo.com/