Collins & Aikman Audit Committee Retains Independent Counsel for Investigation of Previously-Reported Accounting Matters
25 3월 2005 - 8:55AM
PR Newswire (US)
Collins & Aikman Audit Committee Retains Independent Counsel
for Investigation of Previously-Reported Accounting Matters TROY,
Mich., March 24 /PRNewswire-FirstCall/ -- Collins & Aikman
Corporation (NYSE:CKC) announced today that its Audit Committee has
retained independent counsel to assist it in its investigation of
the Company's accounting for certain supplier rebates. The company
previously reported that it had identified certain accounting for
supplier rebates that led to premature or inappropriate revenue
recognition or that was inconsistent with relevant accounting
standards and the Company's policies and practices. The company's
management immediately initiated an internal review of these
matters while keeping the company's Audit Committee and outside
auditors, KPMG LLP, informed of the status of its review. The Audit
Committee has determined to conduct an independent investigation
into these matters. It has retained independent counsel, Davis Polk
& Wardwell, for that purpose, and they expect to retain such
other advisors, including an accounting expert, as they deem
appropriate. As previously announced, the company's internal review
of vendor rebates covered an aggregate of approximately $88 million
of vendor transactions in fiscal years 2002 through 2004. Of such
amount, the company's management believes that net adjustments of
approximately $10 - $12 million are required primarily occurring
during fiscal 2004. For further clarification, the company
announced that management's preliminary analysis indicates that, of
such amounts, approximately $8 - 10 million would impact the
previously reported nine months ended September 30, 2004 with the
balance impacting 2003. The company expects to restate its results
for the nine months ended September 30, 2004 to reflect these
revisions and is continuing to evaluate whether a restatement of
its 2003 results will be necessary. The company's Audit Committee
and the Company's outside auditors, KPMG LLP, have not commented
upon management's current expectations. The company cannot
presently comment upon the timing for completion of, or the
ultimate scope or outcome of, the Audit Committee investigation,
the audit or any necessary restatements. Nor can it comment upon
whether the outcome of the investigation will impact the foregoing
adjustments. As previously disclosed, the company has not yet filed
its annual report on Form 10-K for 2004 due to this accounting
matter and the need for additional time for completion of the 2004
audit and the review of internal controls over financial reporting
under Section 404 under Sarbanes-Oxley. The company further
announced that it initiated a process for obtaining waivers of the
financial statement delivery requirements for a period of time from
its lenders under its senior credit facility and for modifications
of certain of its financial covenants. There can be no assurance
that any of the required or desirable waivers from our senior
lenders, lessors or others will be received on a timely basis, and
the failure to obtain waivers could materially and adversely affect
the company and its liquidity. Collins & Aikman Corporation, a
Fortune 500 company, is a global leader in cockpit modules and
automotive floor and acoustic systems and is a leading supplier of
instrument panels, automotive fabric, plastic-based trim, and
convertible top systems. Headquartered in Troy, Michigan, we have a
workforce of approximately 23,000 and a network of more than 100
technical centers, sales offices and manufacturing sites in 17
countries throughout the world. Information about Collins &
Aikman is available on the Internet at
http://www.collinsaikman.com/ . Cautionary Statement Concerning
Forward-Looking Information The foregoing reflects the Company's
views about the accounting investigation, its financial condition,
performance and other matters that constitute "forward-looking"
statements, as that term is defined by the federal securities laws.
You can find many of these statements by looking for words such as
"may," "will," "expect," "anticipate," "believe," "estimate,"
"should," "continue," "predict," "preliminary" and similar words
used herein. These forward-looking statements are intended to be
subject to the safe harbor protection provided by the federal
securities laws. These forward-looking statements are subject to
numerous assumptions, risks and uncertainties. Because the
statements are subject to risks and uncertainties, actual
developments and results may differ materially from those expressed
or implied by the forward-looking statements. Readers are cautioned
not to place undue reliance on the statements, which speak only as
of the date hereof. Various factors that may affect actual outcomes
and performance and results include, but are not limited to,
general economic conditions in the markets in which the Company
operates, declines in North American, South American and European
automobile and light truck builds; labor costs and strikes at the
Company's major customers and at the Company's facilities;
fluctuations in the production of vehicles for which we are a
supplier; changes in the popularity of particular car models,
particular interior trim packages or the loss of programs on
particular vehicle models; dependence on significant automotive
customers; the level of competition in the automotive supply
industry and pricing pressure from automotive customers; risks
associated with conducting business in foreign countries; and
fluctuation in the price of certain raw materials, including resins
and other petroleum-based products. In addition, the following may
have a material impact on actual outcomes and performance and
results: the results of the pending investigation; the Company's
ability to maintain satisfactory relations with its sources of
liquidity, suppliers, customers and creditors; the Company's high
leverage and ability to service its debt; and the impact of any
defaults under its material agreements and debt instruments. The
cautionary statements set forth above should be considered in
connection with any subsequent written or oral forward-looking
statements that the Company or persons acting on its behalf may
issue. The Company does not undertake any obligation to review or
confirm analysts' expectations or estimates or to release publicly
any revisions to any forward-looking statements to reflect events
or circumstances after the date of this report or to reflect the
occurrence of unanticipated events. DATASOURCE: Collins &
Aikman Corporation CONTACT: Bryce Koth, Chief Financial Officer,
+1-248-824-1520, , or David A. Youngman, Director of Corporate
Communications, +1-248-733-4355, , both for Collins & Aikman
Corporation Web site: http://www.collinsaikman.com/
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