Interpublic Again Delays Quarterly Accounts

12 August 2005

The accounting systems at the globe's third largest agency holding company are evidently still in their beta version.

Yet again Interpublic Group warns of further delay in filing its financial results - currently outstanding are the full year numbers for 2004 and the first two quarters of 2005.

And on Wednesday, IPG confirmed in a filing with the SEC that its Q2 results for the current year are unlikely to be announced until September 30 - if then.

The filing cautions that the company can "provide no assurance that it will complete these filings in time to meet this target because extensive work remains to be done".

But why the continuing delays? Interpublic blames these on the "breadth of the additional internal work and analysis required due to the material weaknesses management has identified as part of its assessment of the company's internal control over financial reporting."

It also cites "the need to determine whether certain matters will require a restatement of financial statements for prior periods".

Last month IPG hired Frank Mergenthaler, its fourth chief financial officer in three years. He replaced Robert Thompson who quit in June, provoking acid comments from the financial haruspices.

"The announcements today clearly did not make us feel more positive about the IPG story," quoth Merrill Lynch media analyst, Lauren Rich Fine.

While Deutsche Bank analyst Paul Ginocchio went to the heart of the matter. "This is a company that has 1,400 reporting units that aren't linked," he said. "They have no central accounting system."

Data sourced from AdWeek (USA); additional content by WARC staff