Stein Mart to Restate Several Financial Reports
November 27, 2012-- Home Textiles Today,
JACKSONVILLE, FLA. - Based in part from a revision to how it had been accounting for markdowns and leasehold improvement costs, Stein Mart said it will restate its financials for fiscal years 2009, 2010 and 2011 as well as the first quarter of 2012.
Quarterly earnings data for each of the three fiscal years also will be restated.
"None of the adjustments necessary to correct any of the errors will impact reported cash balances currently," the company said in a statement.
Stein Mart had been accounting for some markdowns as promotional or temporary, which doesn't impact the value of unsold inventory or the cost of sales until the merchandise is sold.
The company now believes those markdowns should have been categorized as permanent, which would impact the value of the unsold inventory as well as the cost of sales.
Stein Mart estimates the value of inventories were overstated by roughly $2 million as of July 28 of this year and cost of merchandise sold was unstated by a similar about. It expects variations in previous quarters.
The discovery came to light as Stein Mart was completing the installation of a new merchandise information system.
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