United Mobile Homes, Inc. Announces Restatement of Financial Statements to Correct Accounting for Interest Rate Swap Agreements
16 3월 2005 - 7:46AM
PR Newswire (US)
United Mobile Homes, Inc. Announces Restatement of Financial
Statements to Correct Accounting for Interest Rate Swap Agreements
FREEHOLD, N.J., March 15 /PRNewswire-FirstCall/ -- United Mobile
Homes, Inc. (AMEX:UMH) announced today that following a review of
its accounting treatment of various interest rate swaps, the
Company, in consultation with its external auditors, KPMG LLP, has
determined that it is necessary to restate its previously issued
financial statements for periods ending on or prior to September
30, 2004. In an ongoing review of its accounting policies, the
Company determined that the accounting for certain of its interest
rate swaps did not comply with generally accepted accounting
principles in the U.S. (GAAP). Although management believes the
substance of the interest rate swaps achieved the original
objectives of converting certain variable rate debt to effectively
fixed rate obligations, certain technical documentation
requirements for hedge accounting under Financial Accounting
Standards Board (FAS) Statement No. 133 "Accounting for Derivative
Instruments and Hedging Activities" and related interpretations
were not met. Historically, the Company treated these interest rate
swaps as embedded derivatives and did not separately recognize the
fair value of these derivatives as an asset/liability in the
Company's consolidated financial statements. The Company disclosed
these borrowings as fixed rate obligations. Since these
transactions do not qualify for hedge accounting under FAS
Statement No. 133, the Company must record the fair value of the
derivatives as an asset/liability and the changes in fair value as
an income/expense in the period that such changes occurred. KPMG
LLP is in the process of completing their 2004 audit of the
Company's consolidated financial statements. Management estimates
that these non-cash adjustments have the effect of decreasing net
income by approximately $531,000 for the year ended December 31,
2002 and increasing net income by approximately $390,000 for the
year ended December 31, 2003. The impact of this accounting change
for the nine months ended September 30, 2004 is to increase net
income by approximately $249,000. There is no effect on historical
or future net cash flows provided by operating activities. The
restated financial statements for the two-year period ended
December 31, 2003, the four quarters of 2003 and the first three
quarters of 2004 will be reflected in the Company's 2004 Annual
Report on Form 10-K. Accordingly, the financial statements and the
related independent auditors' reports contained in the Company's
prior filings with the Securities and Exchange Commission should no
longer be relied upon. Due to this restatement, the Company does
not expect to file its 2004 Annual Report on Form 10-K by March 16,
2005. The Company will file a Notification of Late Filing on Form
12b-25 with the Securities and Exchange Commission today in
connection with this delay. United Mobile Homes, Inc., a
publicly-owned real estate investment trust, owns and operates
twenty-seven manufactured home communities located in New Jersey,
New York, Pennsylvania, Ohio and Tennessee. In addition, the
Company owns a portfolio of REIT securities. This press release
contains various "forward-looking statements" within the meaning of
the Securities Act of 1933 and the Securities Exchange Act of 1934,
and the Company intends that such forward-looking statements be
subject to the safe harbors created thereby. The words "may,"
"will," "expect," "believe," "anticipate," "should," "estimate,"
and similar expressions identify forward-looking statements. These
forward-looking statements reflect the Company's current views with
respect to future events and finance performance, but are based
upon current assumptions regarding the Company's operations, future
results and prospects, and are subject to many uncertainties and
factors relating to the Company's operations and business
environment which may cause the actual results of the Company to be
materially different from any future results expressed or implied
by such forward-looking statements. Such factors include, but are
not limited to, the following: (i) changes in the general economic
climate; (ii) increased competition in the geographic areas in
which the Company owns and operates manufactured housing
communities; (iii) changes in government laws and regulations
affecting manufactured housing communities; and (iv) the ability of
the Company to continue to identify, negotiate and acquire
manufactured housing communities and/or vacant land which may be
developed into manufactured housing communities on terms favorable
to the Company. The Company undertakes no obligation to publicly
update or revise any forward-looking statements whether as a result
of new information, future events, or otherwise. DATASOURCE: United
Mobile Homes, Inc. CONTACT: Rosemarie Faccone or Susan Jordan,
United Mobile Homes, Inc., +1-732-577-9997
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United Mobile (AMEX:UMH)
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United Mobile (AMEX:UMH)
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