Shock: Overstock.com Needs to Restate Its Financials. Again.
Pic credit: toothpaste for dinner
(h/t Gary Weiss who promises exciting news on this, the latest Overstock.com restatement, as it is more, erm, problematic than previous filings)
Surprise, surprise, Overstock needs, um, just a little more time to figure out this
Oh EDGAR! You never let me down:
As announced on January 29, 2010, Overstock.com, Inc. (the “Company”) is restating its previously issued financial statements for the fiscal year ended December 31, 2008 (including the interim periods within that fiscal year), and the quarterly periods ended March 31, 2009, June 30, 2009 and September 30, 2009 to correct errors related to:
- Operational errors and the accounting for amounts that the Company pays its drop ship fulfillment partners and an amount due from a vendor that went undiscovered for a period of time. Specifically, these errors related to (1) amounts the Company paid to partners or deducted from partner payments related to return processing services and product costs and (2) amounts the Company paid to a freight vendor based on incorrect invoices from the vendor. Once discovered the Company applied “gain contingency” accounting for the recovery of such amounts, which was an inappropriate accounting treatment.
- The accounting for certain of the Company’s share-based compensation plans. Specifically, the Company incorrectly amortized the expense related to restricted stock units based on the actual three year vesting schedule rather than a three year straight line amortization schedule and applied an outdated forfeiture rate in calculating share-base compensation expense under the plans.
- Identification of amounts related to customer refunds and credits not properly included in the Company’s monthly reconciliation of customer refunds and credits to third party statements to determine the completeness and accuracy of returns expense.
- The accounting for certain external audit fees on a ratable basis, instead of as incurred.
- The recognition of co-branded credit card bounty revenue and promotion expense on an immediate recognition basis, instead of over time.
- The late recognition of a reduction in the restructuring accrual for a new sublease and the recognition of interest expense related to the accretion of the restructuring accrual.
- Other miscellaneous corrections and reclassifications, none of which were material either individually or in the aggregate.
- Management is completing its evaluation of the impact of the accounting errors identified above on the Company’s historical financial statements and in connection with the Company’s evaluation of its internal control over financial reporting and disclosure controls and procedures.
The Company is delaying the filing of its Annual Report on Form 10-K for the fiscal year ended December 31, 2009 until it has completed the restatement process and all procedures necessary to file the 2009 Form 10-K. Also in its 2009 Form 10-K, the Company plans to report material weaknesses in its internal control over financial reporting.
As previously disclosed in a January 14, 2010 Form 8-K/A filing Patrick Byrne, the Company’s Chief Executive Officer, had stated to The New York Observer, “that the company is about to report its first annual profit.” The Company continues to believe that it will report positive net income for fiscal 2009.
Bwhahahaha! Oh Overstock, when will you learn? The jig is up, time to come clean and move on or else Gary Weiss, Sam Antar, Barry Ritholz, Caleb Newquist, Henry Blodget and of course yours truly can just sit here ripping on you some more (how am I the only female among foaming-at-the-mouth OSTK critics and more importantly, does Patrick Byrne have the large pair required to come fuck with this girl? Sam Antar went off the record as saying Patrick has none at all but I bet if you ask nicely he'll go on the record with that.). Trust us, it never gets old. Well scratch that, it's getting kind of old. Yawn.
Hey, style points to Byrne and Co. for waiting until the very last minute possible (we had our money on Byrne wising up and at least trying to get this in Monday morning, silly us) to submit this to the SEC, every minute counts when you're
Or blame Grant Thornton? Bwhahahaha twice!