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WW International’s $2 Million Misstatement Went Undiscovered Two Years
Weight loss firm also corrects $3.5 million in prior accounting misstatements that had already been corrected once.
November 4, 2023
Early in the fourth quarter WW International (WW), a provider of weight management products and services, says it discovered misstatements in its accounting for income taxes that resulted in understated net loss in 2022. The error in calculating deferred tax assets and liabilities should have been recorded, as described by the company, in prior fiscal years.
In addition to the revision in its latest quarterly filing, WW International also decided to correct other previously identified immaterial misstatements that were previously corrected as out-of-period adjustments during the year ended December 31, 2022.
The $3.5 million in other misstatements were previously corrected through out-of-period adjustments and included income tax misstatements.
The errors were related to:
—the reversal of a basis difference related to goodwill and other intangibles
—a U.S. federal income tax receivable
—the release of a brand marketing accrual that should have been released in a prior year
In all, the errors resulted in WW International:
—Understating its net loss $2.18 million, or 0.99% in the nine months ended October 1, 2022
—Understating its net loss $3.2 million, or 10% in the three months ended December 31, 2022
WW International says the errors aren’t material and is not correcting previous filings that are inaccurate.
Earlier this year DuDil flagged a disclosure revealing Oprah Winfrey, a marketing partner of the company, planned to sell more than 6.45 million shares, or more than $69 million at WW International’s stock price on August 3, 2023.
WW International shares are down 31.5% since then.
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