Mod-Pac Corp. is reducing its reported profits for last year by $160,000 because of accounting mistakes that understated the cost of some of the products its sold last year, the Buffalo printing and packaging manufacturer said Tuesday.
The impact of the restatement, which is equal to 4 cents per share, is less than half of the maximum impact that Mod-Pac officials warned investors about last week, when they initially disclosed the discovery of the accounting errors.
The mistake stemmed from the failure of the company to include $250,000 in costs during the fourth quarter of last year. The error also caused Mod-Pac to reduce the cash on its balance sheet and increase its receivables by $400,000, Mod-Pac said in a filing with the Securities and Exchange Commission.
The company said routine account reconciliations on the company's cash and accounts payable accounts had not been performed in "an accurate and timely manner" this year and last year.
Mod-Pac said it has implemented "significant improvements" in its internal controls because of the errors and has discussed the issues with its auditors, Ernst & Young.