INX Announces Intention to Restate Financials
June 21 2010 - 4:31PM
Business Wire
As previously disclosed, INX (NASDAQ: INXI) undertook a review
of its multi-element revenue arrangements. Based on this review,
INX today announced that, upon the recommendation of management,
the Audit Committee of the Board of Directors determined that the
previously issued financial statements included in our annual
report on Form 10-K/A for the year ended December 31, 2008, our
quarterly report on Form 10-Q/A for the fiscal quarter ended March
31, 2009, and our quarterly reports on Form 10-Q for each of the
fiscal quarters ended June 30, 2009 and September 30, 2009 should
no longer be relied upon as a result of certain errors affecting
the timing of recognition of revenues and costs of revenues between
these periods.
The errors identified include (1) errors in the identification
of and accounting for deliverables under multi-element
arrangements, including the treatment of individual product items
as separate deliverables under multi-element arrangements, and the
Company's application of the residual method of revenue recognition
for such multi-element arrangements, (2) errors in the accounting
for customer acceptance and retainer provisions of certain
contracts, and (3) incorrect identification of contract shipping
terms resulting in errors in the timing of recognition of revenues
and costs of revenues for certain transactions.
The Company intends to file its restated financial statements
for the fiscal year ended December 31, 2008 in conjunction with the
filing of its annual report on Form 10-K for the year ended
December 31, 2009. The Company intends to file an amended Form
10-Q/A for each of the quarters ended March 31, 2009, June 30, 2009
and September 31, 2009. The Company expects to complete the filings
as soon as practicable.
In addition to the impact of the restatement on the Company's
previously issued financial statements the Company will also
evaluate whether the errors were the result of a material weakness
in internal control over financial reporting and will include the
results of this evaluation in the 2009 Form 10-K and Form
10-Q/A's.
The Company has informed Grant Thornton LLP, the Company's
former independent registered public accounting firm of the matters
disclosed in this filing. Additionally, the Company has discussed
the matters disclosed in this filing with PricewaterhouseCoopers
LLP, the Company's independent registered public accounting firm
since June 8, 2009.
ABOUT INX INC.:
INX Inc. is a leading U.S. provider of IP network communications
and data center solutions for enterprise organizations. INX offers
a suite of advanced technology solutions focused around the entire
life-cycle of enterprise IP network communications and data center
infrastructure. Service offerings are centered on the design,
implementation and support of network infrastructure, including
routing and switching, wireless, security, unified communications,
and data center solutions such as storage and server
virtualization. Customers include enterprise organizations such as
corporations, as well as federal, state and local governmental
agencies. Additional information about INX can be found on the Web
at www.inxi.com.
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