Accounting & Tax

Late-filing Notices Up in First Quarter

More ''accelerated filers'' delayed their quarterly report than at any time in the past two years.
Stephen TaubMay 26, 2006

For the first quarter of this year, late-filing notices by accelerated filers rose 32 percent compared with the first quarter of 2005, according to a new report from Glass, Lewis.

This month, 120 companies with a market capitalization of $75 million or more notified the Securities and Exchange Commission that they would be late filing their quarterly report, wrote Glass, Lewis, compared with 91 companies a year earlier and just 35 in the first quarter of 2004. Indeed, this is the largest number of quarterly late filers in the past two years.

The proxy-advisory firm identified a number of what it calls chronic late filers — including Flowserve, HealthSouth, Financial Industries, and MedQuist — that were late filing their 2005 and 2004 annual reports as well as all their quarterly reports in those years.

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The report also identified 22 companies that will file late due to unresolved accounting issues that may lead to restatements. Seven of them — including Altera, Affiliated Computer Services, and Power Integrations — disclosed that the delay was related to their review of historical option-granting policies.

Glass, Lewis identified 42 companies that were late due to previously announced restatements; they include Fannie Mae, still endeavoring to resolve a major accounting scandal.

Incomplete internal-controls assessments, either by businesses or their auditors, caused a delay at four companies: Allied Defense Group, Borland Software, Nu Skin Enterprises, and Orchid Cellmark. Glass, Lewis noted that all but Nu Skin were still completing their year-end assessments and have not yet filed their 2005 annual report.