Kraft Heinz To Restate Certain Financial Reports After Investigation
Kraft Heinz Co will restate financial reports for certain periods to fix errors that resulted from lapses in its procurement practices by some employees, the packaged food company said in a filing on Monday.
The company also said it will not be able to timely file its quarterly report for the period ended March 30, sending its shares down 2.24% before the bell.
Kraft Heinz also said it received an additional subpoena from the U.S. Securities and Exchange Commission (SEC) on March 1, related to the assessment of goodwill and intangible asset impairments and a request for documents associated with the procurement business.
The company had disclosed in February it had been subpoenaed by the SEC related to an investigation into its accounting policies, procedures and internal controls related to its procurement.
Following the first subpoena, the company, together with its external counsel and forensic accountants, initiated an investigation into the procurement practices.
Kraft Heinz had in February also announced a $15.4 billion write-down of its iconic Kraft and Oscar Mayer brands. Monday's filing revealed that the misstatements would increase the amount by about $13 million.
The misstatements in its reports for the years 2016, 2017 and each of the quarterly and year-to-date periods for the nine months ended Sept. 29, 2018 mainly relates to incorrect timing of when certain costs and rebates were initially recognized, the company said.
The investigation and review required adjustments of about $208 million.
The misstatement was not "quantitatively material" to its financial statements, the company said.