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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Bob Rudd who wrote (11296)	10/16/2000 2:54:25 PM
From: rjm2	Respond to of 78615

Sport-Haley Announces Delay in Filing of Form 10-K; Restatement Pending of Financial Statements for Years Ended June 30, 1999 and 1998 DENVER, Oct 16, 2000 /PRNewswire via COMTEX/ -- Sport-Haley, Inc. (Nasdaq: SPOR chart, msgs) today announced that its filing of the Form 10-K for the year ended June 30, 2000 has been delayed and that it currently expects the Form 10-K for the 2000 fiscal year to be filed during the week of October 23, 2000. In July 2000, Sport-Haley announced that its audit committee had recommended that the prior independent auditors be discharged and that the Company retain a new independent public accountant to audit the financial statements for the year ended June 30, 2000. As a result of a review initiated by senior management and conducted prior to completion of the audit process for the Company's 2000 fiscal year, information was developed that indicated certain accounting errors may exist in prior years' financial statements that, when corrected, would result in a material impact on results of operations for the 2000 fiscal year and certain prior periods. At the conclusion of the review, the Company determined that the accounting errors required restatement of the financial statements for the years ended June 30, 1999 and 1998. The errors consist primarily of the following: (i) incorrect recording, classification and valuation of inventory work in process; (ii) incorrect recording of certain prepaid and fixed assets; (iii) incorrect accounting for the acquisition of the Company's wholly-owned subsidiary and the related minority interest in the loss of the subsidiary; and (iv) incorrect recording of certain losses relating to discontinued operations. The Company has requested its independent accounting firm that was retained following the year ended June 30, 2000 to re-audit the financial statements for the years ended June 30, 1999 and 1998, which the Company is restating. The restatement is expected to result in a material increase in reported net income for the year ended June 30, 2000 and a reduction of net income in at least one of the two prior years' financial statements. The audit committee of the Board of Directors of the Company has retained an independent consultant to assist it in evaluating the restatements that are necessary in order that the Company's financial statements, as restated and taken as a whole, present fairly in all material respects the Company's financial position, results of operations and cash flows for the fiscal years ended June 30, 1998, 1999 and 2000, in conformity with generally accepted accounting principles. The audit committee of the Board of Directors does not believe that the errors that have been identified by the Company constitute irregularities." How exactly can you restate several years income and it NOT constitute irregularities ? Does this mean that restatements are regular for SPOR ?