Thursday June 28, 10:35 am Eastern Time
SEC still says Pre-Paid should restate results
ADA, Okla., June 28 (Reuters) - Pre-Paid Legal Services Inc. (NYSE:PPD - news) on Thursday said U.S. regulators, in response to an appeal, continue to believe that the provider of legal services plans should lower its previously reported results for 1999 and 2000, as well as for the first quarter of 2001.
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In May, the company, based in Ada, Oklahoma, appealed a ruling by the Securities and Exchange Commission that Pre-Paid's accounting policy for commission advance receivables did not conform to generally accepted accounting principles, or
Gaap.
Pre-Paid said it intended to request a meeting with the SEC's chief accountant to discuss its position, although the company said it did not know when or if such a meeting would occur and whether a meeting would change the SEC's stance.
``We continue to believe our current accounting policy is in accordance with GAAP, reflects the economic reality of our business and clearly illustrates to our shareholders the progress of our business in a given reporting period,'' said Chief Operating Office Randy Harp in a statement.
If the SEC proposal for commissions is adopted and the company expenses commission advances in the first year as customer acquisition costs, Pre-Paid would report earnings per share of 27 cents in the first quarter of 2001, 81 cents for 2000 and 57 cents for 1999. Previously, the company reported earnings of 60 cents a share in the first quarter, $1.92 in 2000 and $1.67 in 1999.
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