Sun Microsystems Inc. announced that it would restate its 2003 and 2004 financial results after identifying errors related to the accounting for a number of tax-related issues.
The struggling computer manufacturer elaborated that the issues include deferred taxes in certain foreign jurisdictions, as well as the aggregate effect of corrections to provisions for state and foreign tax returns and withholding taxes.
The revisions will reduce the benefit from income taxes for fiscal 2005 by $45 million and decrease the provision for income taxes for 2003 by $45 million. The errors and revisions will not impact 2004 financial statements, the company added.
The restatements also widened the company’s loss for fiscal 2005 to $107 million, from the $62 million it would have reported. For 2003, the changes trimmed the loss slightly, to $3.38 billion. The adjustments have no impact on revenue, gross margin, pre-tax income, or operating cash flows for the restated periods.
Sun noted that the errors were identified through the operation of the company’s internal controls over financial reporting. “Although the adjustments were small given the size of our company, they do provide additional clarity for our shareholders,” said Steve McGowan, chief financial officer and executive vice president for corporate resources, in a statement.