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Northwest Pipe overstated profits by millions

By Aaron Corvin, Columbian Port & Economy Reporter
Published: July 30, 2010, 12:00am

Vancouver-based Northwest Pipe Co. overstated its profits by $37 million to $47 million over the course of a number of years, the company disclosed Friday.

From Jan. 1, 2005, to June 30, 2009, the company previously reported $91.6 million in profits, but that figure was $17 million to $22 million too high because of errors in accounting procedures, according to a filing with the U.S. Securities and Exchange Commission.

Before 2005, Northwest Pipe also overstated profits by $20 million to $25 million over a period of several years.

“The company is aware that the occurrence of a restament of previously issued financial statements to correct errors is a strong indicator that material weaknesses in internal controls over financial reporting exist,” the company told the SEC. “Accordingly, management is assessing the effectiveness of the company’s internal control over financial reporting.”

The company said it does not yet know when it will be able to provide restatements of past financial reports, which are currently under development.

In detailing its situation, the company outlined a number of highly technical accounting errors related to when it booked expenses and how it calculated financial results.

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Columbian Port & Economy Reporter