Business Context and Reporting Period
Company: Kosmos Energy Ltd.
Filing Type: Form 8-K (Current Report)
Date of Report: January 26, 2013
Subject: Non-reliance on previously issued financial statements due to errors in the presentation of basic and diluted net income per share attributable to common shareholders.
Key Financial Metrics
This filing does not report new revenue, profit, cash flow, or debt figures. It addresses a restatement of per-share metrics for historical periods. The filing explicitly states that total net income (loss), consolidated balance sheets, statements of cash flows, and statements of comprehensive income remain unchanged.
| Period | Original Reported EPS | Corrected EPS | Impact on Total Net Income |
|---|---|---|---|
| May 16, 2011 – Dec 31, 2011 | $0.06 (Pro Forma) | $0.09 | No Change |
| May 16, 2011 – Sep 30, 2011 | ($0.03) Loss (Pro Forma) | $0.00 | No Change |
| May 16, 2011 – Jun 30, 2011 | ($0.19) Loss (Pro Forma) | ($0.14) Loss | No Change |
Material Changes Versus Prior Period
The material change involves the correction of the weighted average number of shares used to compute earnings per share (EPS) and the removal of pro forma EPS presentations from the face of the consolidated statements of operations. The Audit Committee concurred with management that the Original Form 10-K (filed March 1, 2012) and Original Form 10-Q (filed November 5, 2012) should no longer be relied upon for these specific metrics.
Guidance, Outlook, and Risks
Management Commentary: The company is filing Amendment No. 1 on Form 10-K/A and Form 10-Q/A to present the corrected EPS figures and update related disclosures. Management and the Audit Committee discussed these matters with the independent registered public accounting firm.
Risks/Contingencies: The primary risk addressed is the potential for investor misinterpretation of historical profitability on a per-share basis due to the prior presentation errors. No new operational risks or guidance were disclosed in this filing.
Investor Verification Checklist
- Verify the corrected EPS figures in the upcoming Form 10-K/A and Form 10-Q/A filings.
- Confirm that total net income and cash flow statements remain consistent with previously filed reports.
- Review the revised weighted average share counts used in the amended filings.
- Note that periods prior to the May 16, 2011 corporate reorganization do not include EPS calculations as common stock was not outstanding.