PPG Fires Controller Amid Accounting Investigation
Global coatings manufacturer PPG (Pittsburgh) announced Thursday (May 10) that it has terminated its former vice president and controller after an internal investigation revealed improper accounting practices not only in the company's 2018 first quarter but also stretching back to 2017.
The company said in a press release that it has filed for an extension with the U.S. Securities and Exchange Commission because it was unable to submit its quarterly report on Form 10-Q for the first quarter of 2018 in time for its May 10 deadline. PPG had noted when it publicly released its first-quarter numbers in April that inconsistencies had been found in some of its accounting, and that some of the numbers in its preliminary report could be incorrect.
PPG did not name the official who was fired in its press release but said that the controller had been placed on leave on April 25 and was officially terminated May 10. As of Friday morning (May 11), the company’s website identified Mark C. Kelly as vice president and controller, and reports, including one from the Pittsburgh Post-Gazette, identified Kelly as the terminated employee.
Two other employees who reported to Kelly have been reassigned in the wake of the accounting problems, according to PPG; some employees working under the controller made improper entries at his direction, the company says.
According to PPG’s statement, the initial findings involved a failure to record amortization expenses, understatement of a health insurance accrued liability and failure to record an adjustment increasing the value of inventory during 2018 Q1, which ended March 31.
Beyond the discrepancies in the first quarter of 2018, PPG says its investigation found further issues with accounting in 2017, and as a result, quarterly reports and the company’s annual report for 2017 “should no longer be relied upon.”
PPG says it will not provide further information until the investigation is concluded “or the Company determines that further disclosure is appropriate or necessary.”