econ4 abstract article

econ4 abstract article - Although, some may see this...

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Jason Tang #203 Joey Goldenberg #72 06/02/08 Econ 4 Prof. Willoughby Krispy Kreme Report Calls for Earnings Restatement Krispy Kreme Doughnuts must restate its earnings downward by $22.2 million for 2001-2004 and the first nine months of fiscal 2005 and by 3.4 million for previous years due to improper recognition of revenue and improper reduction of expenses. The committee which recommended this report note that the accounting errors strongly suggest that the former CEO Scott Livengood and COO John Tate tried to manage earnings by structured timing of transactions. By improperly recognizing revenue and reducing expenses, Krispy Kreme Doughnuts made its stock more appealing to the general public and at the beginning of 2000 when the company went public the stock was a favorite of Wall Street.
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Unformatted text preview: Although, some may see this restatement as relatively small, in the corporate culture driven to beat or exceed projected earnings by pennies per share this restatement is critical; the restatement has changed the income statement thus devalued the financial performance of the company dating back to 2001. For those investors that have shares of Krispy Kreme Doughnuts (NYSE: KKD), this loss of revenue could have been a decisive factor to make an investment in the company or not. To make this clear, there has been a shareholder demand that Krispy Kreme sue any current or former directors or executives for these accounting errors. Krispy Kreme Doughnuts has failed to meet its accounting and financial reporting obligations to its shareholders and the public....
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This note was uploaded on 06/11/2008 for the course ECON 201900 taught by Professor Willoughby during the Spring '08 term at UCSD.

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econ4 abstract article - Although, some may see this...

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