UTStarcom Seeks Extension
UTStarcom
(UTSI) - Get Report
said it would file with regulators for a 15-day extension on its annual report, as the wireless company continues to struggle with accounting issues.
The Alameda, Calif., maker of short-range wireless networks said late Thursday that it needs time to work on two items: the consolidation of certain financial results associated with a related party, and an assessment of internal controls under Section 404 of the Sarbanes Oxley Act of 2002.
The company said properly accounting for the related-party deal could result in a charge of as much as $5 million in either 2003 or 2004.
UTStarcom also said it would make additional restatements to its 2003 numbers. The company said last month it would restate full-year results for that period to correct income tax provision errors. On Thursday, the company said it had identified related errors in each quarter of 2003 that would also need to be corrected as well.
Meanwhile, as has been the case since last summer, UTStarcom continues to try to assess the state of its internal financial controls. The company said last month it had found five material weaknesses, on issues ranging from the expertise of its finance staff to the controls associated with various accounting functions. On Thursday, the company added two more problem areas, touching on disclosure of related-party transactions and revenue recognition.
Late Thursday, UTStarcom fell 23 cents to $12.75.