MusclePharm Announces Results of Audit Committee Review - No Restatement Required
November 15 2013 - 7:00AM
Marketwired
MusclePharm Announces Results of Audit Committee Review - No
Restatement Required
DENVER, CO--(Marketwired - Nov 15, 2013) - MusclePharm
Corporation (OTCQB: MSLP) ("MusclePharm", or the "Company"), a
leading international, award-winning sports nutrition company,
announced today that the Audit Committee of its Board of Directors
has reviewed certain matters that are the subject of the SEC
investigation disclosed in a Form 8-K filed on September 30, 2013
and concluded that no restatement of prior periods' financial
statements is required. The matters reviewed included a loss
of $2.1 million recorded in 2011 in regard to settlement of
accounts payable, the reserve established for previously disclosed
litigation initiated against the Company by William Bossung (the
"Bossung Litigation"), six proposed adjustment entries made by the
auditors in 2012 which were approved by the Audit Committee (the
effect of which were below the materiality threshold of the audit)
and not made by the Company in that year, and the amounts
disclosed as executive perquisites in the Annual Reports on Form
10-K for the fiscal years ended 2010, 2011 and 2012.
The Audit Committee has concluded that the entire amount of the
$2.1 million loss in regard to settlement of accounts payable was
properly recorded in 2011 under Generally Accepted Accounting
Principles ("GAAP"). The Audit Committee has concluded that a
reserve of $60,000 established in 2012 for the Bossung Litigation,
which settled during the third quarter of 2013 by payment of stock
valued at approximately $250,000, was consistent with GAAP, and the
additional expense of $190,000 was properly recorded in the third
quarter. The Audit Committee concluded prior to the filing of the
2012 Form 10-K that the six adjustments proposed by the
auditor were immaterial to the 2012 financial statements and
have determined that they were all properly recorded during the
first quarter of 2013. Finally, in regard to the 2010, 2011 and
2012 perquisite disclosures, the Audit Committee has concluded that
they were understated in each of those years by a combined amount
that the Audit Committee presently estimates to be no more than
$200,000. As soon as the Audit Committee finalizes its review of
the perquisites, such final amounts will be disclosed.
The Company continues to cooperate with the SEC investigation
which is also focused on the adequacy of the Company's internal
controls over financial reporting and its prior disclosures of
potentially related party transactions. Working with the Company's
management, the Audit Committee has enhanced certain internal
controls, including in the area of perquisite approval and
disclosure, and will continue this effort. In the second
quarter of 2013, the Company did disclose related party
relationships involving two named executive officers and a vendor
and is evaluating other relationships to determine whether
additional disclosure is necessary.
ABOUT MUSCLEPHARM CORPORATION
MusclePharm® is a leading international, award-winning sports
nutrition company offering vitamins and nutritional supplements
which are available in more than 110 countries and available in
15,000+ U.S. retail outlets, including Costco, Dick's Sporting
Goods, 24 Hour Fitness, Bally's, GNC, Vitamin Shoppe and Vitamin
World. The company's brands are MusclePharm®, Arnold
Schwarzenegger™ Series, and FitMiss™. The comprehensive lines of
clinically-proven, safe and effective nutritional supplements are
developed through a six-stage research process that utilizes the
expertise of leading nutritional scientists, doctors and
universities. For more information, visit www.musclepharmcorp.com.
Follow the company at http://www.facebook.com/MusclePharm and
www.Twitter.com/MusclePharm.
FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities and Exchange Act of 1934, as
amended. Statements that are not a description of historical facts
constitute forward-looking statements and may often, but not
always, be identified by the use of such words as "expects",
"anticipates", "intends", "estimates", "plans", "potential",
"possible", "probable", "believes", "seeks", "may", "will",
"should", "could" or the negative of such terms or other similar
expressions. Actual results may differ materially from those set
forth in this release due to the risks and uncertainties inherent
in the Company's business. More detailed information about the
Company and the risk factors that may affect the realization of
forward-looking statements is set forth in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2012,
the Company's Quarter Reports on Form 10-Q and other filings
submitted by the Company to the SEC, copies of which may be
obtained from the SEC's website at www.sec.gov. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. All
forward-looking statements are qualified in their entirety by this
cautionary statement and the Company undertakes no obligation to
revise or update this release to reflect events or circumstances
after the date hereof.
MusclePharm Investor Contact: The Del Mar Consulting Group, Inc.
Robert B. Prag President Telephone: 858-361-1786 Email: Email
Contact or Alex Partners, LLC Scott Wilfong President Telephone:
425-242-0891 Email: Email Contact
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