Harwood Feffer LLP Investigates AutoChina International Limited
July 12 2011 - 5:08PM
Business Wire
Harwood Feffer LLP is investigating claims on behalf of
purchasers of the common stock of AutoChina International Limited
(“AutoChina" or the "Company") (NASDAQ: AUTC), concerning whether
the Company and certain of its officers and directors have violated
federal securities laws.
The investigation is connected to AutoChina’s announcement on
June 30, 2011 that the Securities and Exchange Commission (“SEC”)
has commenced a non-public investigation into its accounting.
AutoChina announced that it expects to restate its previously
issued financial statements for the year ended December 31, 2009,
and subsequent periods to recognize a derivative liability relating
to the Earn-out Share Provision (“Earn-out”), which was part of its
initial business combination in 2009.
With respect to the Earn-out shares, AutoChina’s original
accounting treatment recorded the Earn-out shares, upon issuance,
as an adjustment to the par value of ordinary shares and additional
paid-in capital and included such shares in the calculation of
earnings per share from the date of issuance. The SEC has asserted
that the Earn-out should be treated as a derivative financial
instrument, and as a result, a liability should have been initially
recorded at its fair value at the time of the initial business
combination.
In addition, during AutoChina’s 2010 year-end process, the
Company identified a material weakness in its internal control over
financial reporting as of December 31, 2010, due to a lack of
requisite internal U.S. GAAP experience.
Further, AutoChina has announced that it expects that it will
not file its Annual Report on Form 20-F for the year ended December
31, 2010, on time and will file a Form 12b-25 with the SEC for an
extension.
You may contact the Harwood Feffer LLP website (http://www.hfesq.com)
or James G. Flynn, directly, at jflynn@hfesq.com to ask any questions you may have
in that regard.
The Complaint alleges violations of the federal securities laws
against AutoChina and its officers and directors for issuing
materially false and misleading financial statements to
investors.
Harwood Feffer has been representing individual and
institutional investors for many years, serving as lead counsel in
numerous cases in federal and state courts. Please visit the
Harwood Feffer LLP website (http://www.hfesq.com)
for more information about the firm.
Attorney Advertising. © 2011 Harwood Feffer LLP. The law firm
responsible for this advertisement is Harwood Feffer LLP
(www.hfesq.com). Prior results do not guarantee or predict a
similar outcome with respect to any future matter.
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