CPI Aerostructures to Restate Financials
Ticker: CVU · Form: 8-K · Filed: Apr 3, 2024 · CIK: 889348
| Field | Detail |
|---|---|
| Company | Cpi Aerostructures INC (CVU) |
| Form Type | 8-K |
| Filed Date | Apr 3, 2024 |
| Risk Level | high |
| Pages | 4 |
| Reading Time | 5 min |
| Key Dollar Amounts | $0.001, $2,603,986 |
| Sentiment | bearish |
Sentiment: bearish
Topics: accounting-error, financial-restatement, revenue-recognition, inventory-valuation
TL;DR
CPI Aero to restate 5 years of financials due to accounting errors. Big red flag.
AI Summary
CPI Aerostructures, Inc. announced on April 3, 2024, that it will restate its previously issued financial statements for the fiscal years ended December 31, 2023, 2022, 2021, 2020, and 2019, and for the interim periods within those years. This restatement is due to errors identified in the accounting for certain revenue recognition and inventory valuation matters.
Why It Matters
Investors should be aware that past financial reports are no longer reliable, potentially impacting investment decisions and stock valuation.
Risk Assessment
Risk Level: high — Restating multiple years of financial statements indicates significant accounting issues that could lead to further complications or impact the company's financial health.
Key Players & Entities
- CPI Aerostructures, Inc. (company) — The company filing the report and announcing the restatement.
- April 3, 2024 (date) — The date of the report and the earliest event reported.
- 2023 (date) — Fiscal year for which financial statements will be restated.
- 2022 (date) — Fiscal year for which financial statements will be restated.
- 2021 (date) — Fiscal year for which financial statements will be restated.
- 2020 (date) — Fiscal year for which financial statements will be restated.
- 2019 (date) — Fiscal year for which financial statements will be restated.
FAQ
What specific accounting errors led to the restatement?
The filing states errors were identified in the accounting for certain revenue recognition and inventory valuation matters.
For which fiscal periods will CPI Aerostructures restate its financial statements?
The company will restate its financial statements for the fiscal years ended December 31, 2023, 2022, 2021, 2020, and 2019, as well as interim periods within those years.
What is the primary reason for this 8-K filing?
The primary reason is to report the non-reliance on previously issued financial statements due to identified accounting errors.
When was the decision made to restate the financial statements?
The filing indicates April 3, 2024, as the date of the earliest event reported, which is when the company announced its intention to restate.
What are the implications of restating financial statements for investors?
Restating financial statements means previously reported figures are no longer considered accurate, which can affect investor confidence and the perceived value of the company's stock.
Filing Stats: 1,201 words · 5 min read · ~4 pages · Grade level 15.6 · Accepted 2024-04-03 17:30:24
Key Financial Figures
- $0.001 — nge on which registered Common stock, $0.001 par value per share CVU NYSE American
- $2,603,986 — ined were each previously overstated by $2,603,986 (the "Deferred Tax Error") as a result
Filing Documents
- cvu-8k_040324.htm (8-K) — 29KB
- ex99-1.htm (EX-99.1) — 18KB
- 0001999371-24-004426.txt ( ) — 219KB
- cvu-20240403_lab.xml (EX-101.LAB) — 33KB
- cvu-20240403_pre.xml (EX-101.PRE) — 22KB
- cvu-20240403.xsd (EX-101.SCH) — 3KB
- cvu-8k_040324_htm.xml (XML) — 3KB
02
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review. On April 3, 2024, the audit and finance committee (the "Audit and Finance Committee") of the board of directors of CPI Aerostructures, Inc. (the "Company"), determined, based on the recommendation of management, that the Company's financial statements which were included in its Annual Report on Form 10-K for the year ended December 31, 2022 as filed with the Securities and Exchange Commission (the "SEC") should no longer be relied upon due to errors within Note 11 "Income Taxes" ("Note 11") to the Company's deferred tax asset and deferred tax liability balances at December 31, 2022, which the Company has determined were each previously overstated by $2,603,986 (the "Deferred Tax Error") as a result of inadequate review, assessment of and reporting of the Company's temporary differences between book and taxable income. Similarly, management's report on the effectiveness of internal control over financial reporting, for such period should no longer be relied upon. The Company is in the process of remediating the material weakness in internal controls and related disclosure controls and procedures that led to the Deferred Tax Error. The Company believes there is no material impact to the previously reported net deferred tax asset on its December 31, 2022 balance sheet, and believes there is no material impact to the Company's previously reported net income, earnings per share or cash flow for the twelve months ended December 31, 2022. On April 1, 2024 the Company filed a Notification of Late Filing on Form 12b-25 (the "Form 12b-25") with the SEC which stated that the Company was unable to file its Annual Report on Form 10-K for the period ended December 31, 2023 (the "2023 Form 10-K") by the prescribed due date without unreasonable effort or expense because the Company requires additional time to finalize the calculation of a correction to Note 1
Financial Statements and Exhibits
Financial Statements and Exhibits. Exhibit Description 99.1 Schedule of Restated 2022 Deferred Income Tax Positions 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: April 3, 2024 CPI AEROSTRUCTURES, INC. By: /s/ Andrew Davis Andrew Davis Chief Financial Officer 4