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True North Blames “Accounting Matter” for Delayed Results

News, 01 March 2001


Chicago-headquartered True North Communications yesterday announced it would delay its Q4 and full-year earnings statement previously slated for today.

Partial reason for the postponement is that True North still awaits an earnings report from interactive agency Modem Media, in which it has a 46% holding. However, there is more to the delay than this: True North also revealed that its accountants had “brought an accounting matter to the attention of the [Securities and Exchange Commission] accounting staff in the past few days and have been in discussions with them.”

Elucidating, True North executive vp/chief financial officer Kevin Smith said that the network was handing over data on the amortisation of intangible assets connected with past acquisitions. However, he insisted: “It is important to recognize that these are technical accounting matters which would not affect either our cash flow or, we believe, the underlying economic value of our business, but could affect how we report our results.”

Smith added that True North was determined to clear up the matter and post its results “promptly”.

News source: Advertising Age - Daily Deadline