Preliminary results indicate that the company did not conform to applicable accounting rules, meaning that, essentially, revenues from multi-year projects were not appropriately accounted on an accrual basis.
Voith stopped the practices immediately and launched an in-depth review of the matter, the company said in a statement, adding that the management team of Voith Hydro Inc. responsible for the affected financial years has been immediately relieved of its duties pending the outcome of the ongoing review. Once the audit is complete, Voith will decide on further measures where required.
Based upon information available at this time, Voith believes that the practices did not impact the customers of Voith Hydro Inc. The potential financial implications, as quantified to date, will be limited. The impact on the consolidated operational result of the Voith Group is less than $1.5M for the fiscal year 2009 according to the current state of the review. The financial statements will be corrected retroactively where required.
