Financial Statements

Executives with Municipal Mortgage & Equity LLC, the real estate and alternative-energy project financier, tried to reassure investors yesterday that the business is growing and to dispel the perception that it's involved in the subprime mortgage morass. But Chief Operating Officer Charles M. Pinckney warned that the Baltimore company might not file corrected financial statements by the end of November, which had been the goal. The company hasn't filed any financial statements in the past year.

PHH Corp., a mortgage and fleet management company with a large operation in Sparks, said yesterday that it must restate almost five years of earnings after an audit found glaring errors in its financial statements. The company, which has its headquarters in Mount Laurel, N.J., previously acknowledged that it has "material weaknesses" in its books. It failed to file an annual report required by the Securities and Exchange Commission for 2005. It also has missed quarterly filings through June this year.

WASHINGTON - Nearly 2 1/2 years after NASA chief Sean O'Keefe vowed to straighten up the agency's bookkeeping, the effort continues to struggle. "It may be years before NASA can get a clean audit," said Robert Cobb, the agency's inspector general, during a hearing yesterday of a subcommittee of the House Government Reform Committee. A plan to unify the National Aeronautics and Space Administration's 10 field centers and its Washington headquarters under a single accounting system, a program that will cost the agency about $1 billion, has created even more short-term chaos.

OMAHA, Neb. - ConAgra Foods Inc., the No. 2 U.S. food company, said yesterday that phony sales and irregular accounting at its farm-products unit has led to a federal inquiry and the overstatement of profits for the past three fiscal years. The maker of Chef Boyardee pasta, Bumble Bee tuna and Hunt's sauces said it will reduce pretax profit by a total of $123 million for fiscal 1998 through 2000, or 3.6 percent. The Securities and Exchange Commission is conducting an informal inquiry into United Agri Products, a seed and fertilizer unit that represents 9 percent of operating profit, the company said.

Rite Aid Corp., the problem-plagued drugstore chain, is expecting the U.S. Securities and Exchange Commission to launch an investigation into accounting practices that are forcing the company to revise its financial statements and slash past profit by $500 million, a company official said yesterday.Rite Aid has been contacted by the SEC's enforcement division, said Karen Rugen, Rite Aid's senior vice president of communications."There is no formal investigation right now," she said. "But given the size of the restatement -- approximately $500 million -- one can be anticipated."

A revolution in corporate annual reports is apparent to shareholders who are receiving fewer traditional reports in 2007. More than half of 200 companies responding to a survey by the National Investor Relations Institute said they are simply wrapping their annual 10-K regulatory filing in a few pages of additional information and making it their annual report. Less than 1 in 6 companies in 2002 was taking this approach that issues reports faster and cheaper. This trend acknowledges that what really counts these days is financial information for institutional and individual investors, plus clear compliance with Securities and Exchange Commission rules.

NEW YORK -- The nation's largest black-owned business is set to become a publicly traded company early next year, according to shareholders and company documents.TLC Beatrice International Holdings Inc., a New York-based food and grocery store company, plans to register its stock with the Securities and Exchange Commission. The stock would be trading as early as February on the Nasdaq stock market.The decision to register the stock, which was revealed in a document filed last week with the SEC, showed that TLC Beatrice has acquiesced to shareholders' demands that the company register its shares with the SEC. The company has been a closely held private business since it was bought by Baltimore native Reginald F. Lewis for $1.6 billion in 1987.

FREMONT, Calif. - Avant! Corp. fired KPMG LP after the nation's third-largest accountant warned that the software maker lacked the ability to detect inaccuracies in its own financial reports. Avant! fired KPMG on April 13, just 11 days after the company filed its annual report with the Securities and Exchange Commission, according to an SEC filing yesterday. KPMG signed off without reservations on the 2000 financial statements for the maker of software used to design computer chips. But on April 23, KPMG notified the SEC that it had warned Avant!

Still reeling from a surprise retirement announcement from its chairman and chief executive officer, Alan J. Noia, Allegheny Energy Inc. said yesterday that its 2003 annual shareholders meeting will be postponed from May 8 until a comprehensive review of financial statements is completed. Allegheny, which has yet to release 2002 and first-quarter 2003 results, said it does not expect to file results with regulators by March 31 as normally required. Allegheny has already warned that errors discovered during the review so far will require a restatement of earnings for the first two quarters of last year.

Refco, the giant commodities and futures brokerage firm that has been unraveling over the last week, is expected to put its futures business into bankruptcy protection today, people briefed on the company's plans said last night. Refco will also announce that it has reached an agreement to sell that business to an investor group led by J. Christopher Flowers, a former Goldman Sachs partner who runs a private equity fund. The business - the only Refco unit remaining that is not in the process of being shuttered - has a book value of roughly $750 million.