Financial Restatements On the Decline—Again

Posted on June 26, 2018July 24, 2018 by Jason Bramwell

There has been a trend in recent years of financial restatements for public companies decreasing, and 2017 was no exception.

A new report by Audit Analytics revealed that the total number of restatements fell for the fifth consecutive year—from 873 in 2013 to 553 in 2017, according to Tammy Whitehouse of Compliance Week.

She also examined the data regarding reissuance restatements and revision restatements:

Reissuance restatements—those that are serious enough to necessitate withdrawing prior financial statements and issuing them anew—fell to 109 in 2017. That number was down from 128 in 2016 and 152 in 2015. The number has fallen steadily every year for the past 10 years, according to the report.

Revision restatements—those in which companies corrected mistakes without withdrawing reliance on prior financials—fell to 370 in 2017, down from 467 in 2016 and 522 in 2015. That type of restatement crept upward for a few years from 2009 to 2014, but then tapered over three consecutive years.

Whitehouse also noted that more than half of restatements (54%) had no effect on net income, which is down from 59% in 2016.

In addition, there’s been an improvement in the quality of financial reporting among accelerated filers. Whitehouse wrote that after steady restatement increases among accelerated filers from 2011 to 2014, when they reached a high of 351, the numbers have since dropped to a total of 184 in 2017.

[CW]

Image: iStock/stevanovicigor

Ninety Percent of Nonprofit Execs Expect 2010 to be as Financially Difficult as 2009

Adrienne Gonzalez
March 24, 2010

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Not to be the harbinger of doom but the Non-profit Finance Fund released a survey Monday that reflects the less-than-optimistic hopes of non-profit leaders for the year ahead. Though it’s far more depressing than Financial Armageddon, it shows that non-profits are far more prepared for the worst (and more deft at handling adversity) than their for-profit counterparts. For-profit CFOs still seem preoccupied with the credit crunch while non-profits are merely trying to meet increased demand with less to provide.

America’s nonprofits expect that 2010 will be financially more difficult or as difficult as 2009, according to a survey released today by Nonprofit Finance Fund (NFF). The survey of more than 1,300 nonprofit leaders in markets nationwide also found strong evidence of the dramatic and creative steps that organizations are taking in order to maintain and even expand service delivery to meet increased demand during this time of continued economic uncertainty.

• Nearly 90% expect 2010 to be as difficult or more difficult than 2009; only 12% expect 2010 to be financially easier for their organizations.

• 80% of nonprofits anticipate an increase in demand for services in 2010; 49% expect to be able to fully meet this demand level.

• Only 18% of organizations expect to end 2010 above break-even; 35% of organizations ended 2009 with an operating surplus.

• The majority — 61% — have less than three months of cash available; 12% have none.

“We expect 2010 to be another treacherous year for many nonprofits that routinely take heroic measures to meet demand for services,” said Clara Miller, President and CEO of NFF. “The economic ‘recovery’ has not yet reached people in need, or the organizations that serve them. We must do more to repair the tattered social safety net.”

Interestingly, only 46% of non-profits surveyed said they believed they would not be able to replace government stimulus money from other sources when the money is gone. Also curious, non-profits appear to be having an easier time of getting loans. Only 30% of survey respondents said they’d applied for a loan in the last 12 months but incredibly 74% of those secured the loan. Oh and 26% said they only applied for a loan because they were waiting for late government payments.

There were quite a few memorable responses from survey participants but I think this one sums up the theme of NFF’s results pretty well: “WE DIDN’T GIVE UP.”

2010 State of the Nonprofit Sector Survey [NFF]