More accounting problems for PPG
Following the discovery of more accounting errors, PPG said it has terminated its controller and reassigned members of its accounting department.
Last month PPG revealed that potential violations of its accounting policies and procedures amounted to $1.4 million in expense errors including legal fees, property taxes and performance-based compensation. The paint and coatings manufacturer has since reported that “quantified errors” will result in a net decrease in income from continuing operations before income taxes of approximately $7.8 million for its first quarter 2018, ending March 31.
The Pittsburgh-based company is delaying its first quarter filing, Form 10-Q, with the Securities and Exchange Commission until the internal investigation is completed.
“The Company is working diligently to complete its investigation, but is currently unable to predict the timing or outcome of the investigation,” PPG said in a prepared statement.
PPG also identified the improper reclassifications of gains from income from discontinued operations to income from continuing operations, including pre-tax amounts of $2.1 million in the quarter ended June 30, 2017 and $4.7 million in the quarter ended Dec. 31, 2017.
The investigation also identified improper shifting of pre-tax expense between quarterly periods in 2017 as follows: including a total of $3.4 million in compensation expense recorded in the third and fourth quarters of 2017 that should have been recorded in the quarter ended June 30, 2017 and additional expense accrual for health care claims in the amount of $3.5 million recorded in the third and fourth quarters of 2017 that should have been recorded in the quarter ended June 30, 2017.
Former vice president and controller Mark Kelly was placed on administrative leave on April 25 before being terminated on May 10. William Schaupp is serving as assistant controller and acting controller in the meantime.
Last month PPG revealed that potential violations of its accounting policies and procedures amounted to $1.4 million in expense errors including legal fees, property taxes and performance-based compensation. The paint and coatings manufacturer has since reported that “quantified errors” will result in a net decrease in income from continuing operations before income taxes of approximately $7.8 million for its first quarter 2018, ending March 31.
The Pittsburgh-based company is delaying its first quarter filing, Form 10-Q, with the Securities and Exchange Commission until the internal investigation is completed.
“The Company is working diligently to complete its investigation, but is currently unable to predict the timing or outcome of the investigation,” PPG said in a prepared statement.
PPG also identified the improper reclassifications of gains from income from discontinued operations to income from continuing operations, including pre-tax amounts of $2.1 million in the quarter ended June 30, 2017 and $4.7 million in the quarter ended Dec. 31, 2017.
The investigation also identified improper shifting of pre-tax expense between quarterly periods in 2017 as follows: including a total of $3.4 million in compensation expense recorded in the third and fourth quarters of 2017 that should have been recorded in the quarter ended June 30, 2017 and additional expense accrual for health care claims in the amount of $3.5 million recorded in the third and fourth quarters of 2017 that should have been recorded in the quarter ended June 30, 2017.
Former vice president and controller Mark Kelly was placed on administrative leave on April 25 before being terminated on May 10. William Schaupp is serving as assistant controller and acting controller in the meantime.