Primis Financial Restates Financials Due to Control Weakness
Ticker: FRST · Form: 8-K · Filed: Sep 12, 2024 · CIK: 1325670
| Field | Detail |
|---|---|
| Company | Primis Financial CORP. (FRST) |
| Form Type | 8-K |
| Filed Date | Sep 12, 2024 |
| Risk Level | medium |
| Pages | 6 |
| Reading Time | 7 min |
| Sentiment | bearish |
Sentiment: bearish
Topics: restatement, internal-controls, accounting-issue
Related Tickers: FRST
TL;DR
Primis Financial (FRST) can't be trusted on its old numbers - credit loss accounting is broken.
AI Summary
Primis Financial Corp. announced on September 9, 2024, that its previously issued financial statements for the fiscal year ended December 31, 2023, and the quarterly periods ended March 31, 2024, and June 30, 2024, should not be relied upon. This is due to a material weakness in internal control over financial reporting related to the accounting for the allowance for credit losses. The company is working to remediate this issue.
Why It Matters
This restatement indicates potential issues with the accuracy of past financial reporting, which could impact investor confidence and require adjustments to future financial statements.
Risk Assessment
Risk Level: medium — A material weakness in internal controls over financial reporting can lead to inaccurate financial statements and requires significant remediation efforts.
Key Players & Entities
- Primis Financial Corp. (company) — Registrant
- September 9, 2024 (date) — Date of earliest event reported
- December 31, 2023 (date) — Fiscal year end for previously issued financial statements
- March 31, 2024 (date) — Quarterly period for previously issued financial statements
- June 30, 2024 (date) — Quarterly period for previously issued financial statements
FAQ
What specific financial statements are affected by the non-reliance announcement?
The financial statements for the fiscal year ended December 31, 2023, and the quarterly periods ended March 31, 2024, and June 30, 2024.
What is the reason for not relying on the previously issued financial statements?
A material weakness in internal control over financial reporting related to the accounting for the allowance for credit losses.
When did Primis Financial Corp. become aware of the issue?
The filing does not explicitly state when the company became aware, but the report date is September 9, 2024.
What is the company doing to address the material weakness?
The company is undertaking remediation efforts to address the material weakness.
Does this announcement impact any prior audit reports or interim reviews?
Yes, the company states that previously issued financial statements or a related audit report or completed interim review should not be relied upon.
Filing Stats: 1,695 words · 7 min read · ~6 pages · Grade level 17 · Accepted 2024-09-12 17:00:19
Filing Documents
- tm2423918d1_8k.htm (8-K) — 36KB
- tm2423918d1_ex7-1.htm (EX-7.1) — 2KB
- 0001104659-24-099369.txt ( ) — 211KB
- frst-20240909.xsd (EX-101.SCH) — 3KB
- frst-20240909_lab.xml (EX-101.LAB) — 33KB
- frst-20240909_pre.xml (EX-101.PRE) — 22KB
- tm2423918d1_8k_htm.xml (XML) — 3KB
02 Non-Reliance on Previously
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review. On September 9, 2024, the management team of Primis Financial Corp. (the " Company ") concluded and, following discussions and in consultation with its independent registered public accounting firm, Forvis Mazars, LLP (the " Auditor "), that due to errors previously described in the Company's filings with the Securities and Exchange Commission (" SEC ") on Form 12b-25 filed by the Company on March 18, 2024, April 1, 2024, May 13, 2024 and August 12, 2024 (the " 12b-25 Filings ") and repeated in this Item 4.02, (i) the Company's audited annual consolidated financial statements for the year ended December 31, 2022, and (ii) as informed by the Auditor, the accompanying audit report, each as previously filed with the SEC (the " Impacted Financial The accounting matters underlying the Company's conclusion relate to errors in the methodology used to account for a portfolio of consumer loans originated and serviced through a third party pursuant to a contractual arrangement between such third party and Primis Bank, which will result in the Company making certain changes to how it accounts for the third-party serviced consumer loan portfolio to correct an error in its previous application of U.S. GAAP, including (collectively, the " Determinations "): Interest income earned on the consumer loans originated by the third-party and funded and held by the Company that are originated with promotional features (e.g. no interest due if paid off within a certain timeframe) will be deferred until the end of that promotional period. If the borrower pre-pays the loan principal before the end of the promotional period, the Company has an agreement with the third-party servicer whereby the third-party servicer will pay the Company all of the interest that had been accruing and is forgiven to the borrower. The credit
01 Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits. (d) Exhibits 7.1 Letter dated September 12, 2024 from Forvis Mazars, LLP to the Securities and Exchange Commission. 104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
SIGNATURES
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PRIMIS FINANCIAL CORP. By: /s/ Matthew A. Switzer September 12, 2024 Matthew Switzer Chief Financial Officer