Orion Energy Systems, Inc. (NYSE Amex: OESX), a leading power technology enterprise, today announced that the Office of the Chief Accountant of the Securities and Exchange Commission did not object to the Company’s conclusion, supported by its independent registered public accounting firm and a third-party independent accounting firm, that generally accepted accounting principles (“GAAP”) require the Company to account for transactions under its historical Orion Throughput Agreements (“OTAs”) as sales-type capital leases instead of the Company’s current accounting treatment of such transactions as operating leases. As a result, as previously announced, the Company will restate its financial statements for its 2010 fiscal year (including each fiscal quarter therein) and for its first three quarters of its 2011 fiscal year, as well as its recently reported preliminary results for its fourth quarter of fiscal 2011 and its full fiscal year 2011.
Generally, as previously announced, this change in accounting treatment and the related financial statement restatements are expected to result in:
- No impact to cash, cash equivalents, short-term investments or overall cash flow.
- An increase in GAAP revenue for the full fiscal years 2011 and 2010.
- An increase in GAAP net income and earnings per share for the full fiscal year 2011 and a reduction in GAAP net loss and loss per share for the full fiscal year 2010.
- An increase in current and total assets and an increase in total shareholders’ equity for fiscal year 2010 and an increase in total shareholders’ equity and a decrease in total assets and current liabilities for fiscal year 2011.
- An increase in GAAP revenue, GAAP net income and earnings per share for the first three quarters of each of fiscal years 2011 and 2010 and a decrease in GAAP revenue, GAAP net income and earnings per share for the last quarter of each of fiscal years 2011 and 2010.
Due to the complexities and complications associated with this restatement, the Company will not be able to file its Annual Report on Form 10-K for its fiscal year ended March 31, 2011 within the 15-day extension period afforded by SEC Rule 12b-25. However, the Company expects to file its Annual Report on Form 10-K for its fiscal year ended March 31, 2011, including its restated annual fiscal 2010 financial statements, within the next several weeks and to shortly thereafter amend its previously filed Form 10-Qs for the first three quarters of each of fiscal 2010 and fiscal 2011 to reflect the restatement.