Potential sale as KIT digital restates financials

November 26, 2012 09.00 Europe/London By Julian Clover

KIT digital has said it has identified a number of errors and irregularities in its financial reporting.

The troubled company, known for its video management software, is expected to make substantial losses during 2012 and says it is considering a range of strategic options that include the sale of the business.
KIT plans to restate its quarterly and annual financial statements issued between 2009 and 2011. The two quarters published so far this year will also be restated and the company has delayed the publication of the quarter ending September 30, 2012.

In a statement, Kit said the irregularities related to “perpetual software license agreements” put in place by the previous management team. They were discovered as part of an investigation by the company’s Audit Committee.
In September KIT digital has announced it was making “significant workforce reductions” as part of a $40 million (€30.5 million) cost saving programme.
The action follows the appointment of activist investor Peter Heiland as interim CEO.