Freightcar America, Inc. - Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K was filed by Freightcar America, Inc. on September 2, 2005. The filing addresses a material accounting reclassification regarding the Company's previously issued financial statements, including audited statements in Form S-1 registration statements and unaudited statements in Form 10-Q reports for the quarters ended March 31, 2005, and June 30, 2005.
Key Financial Metrics and Restatement Details
The filing does not report new revenue, profit, or debt figures. Instead, it details a reclassification of cash flows related to restricted cash deposits. The Company determined that changes in restricted cash balances should be reported as cash flows from investing activities rather than operating activities, in accordance with FASB Statement No. 95.
The aggregate effects of the restatement on the Consolidated Statements of Cash Flows (in thousands) are as follows:
- Year ended Dec 31, 2002: Increase "Net cash flows provided by operating activities" by $55; increase "Net cash flows used in investing activities" by $55.
- Year ended Dec 31, 2003: Increase "Net cash flows provided by operating activities" by $7,582; increase "Net cash flows used in investing activities" by $7,582.
- Year ended Dec 31, 2004: Decrease "Net cash flows used in operating activities" by $1,257; increase "Net cash flows used in investing activities" by $1,257.
- Three months ended March 31, 2004: Decrease "Net cash flows used in operating activities" by $14; increase "Net cash flows used in investing activities" by $14.
- Three months ended March 31, 2005: Increase "Net cash flows provided by operating activities" by $40; increase "Net cash flows used in investing activities" by $40.
The restatement has no effect on the overall net cash and cash equivalent position, nor does it impact the Consolidated Statements of Operations, Balance Sheets, or Statements of Stockholders' Equity.
Material Changes and Management Commentary
The material change is the non-reliance on previously issued financial statements due to the reclassification of restricted cash flows. Management and the Audit Committee concluded that the prior reporting of these items under operating activities was incorrect. The Company has discussed these matters with its independent registered public accounting firm, Deloitte & Touche LLP.
The Company plans to file amendments to its Form 10-Q reports for the fiscal quarters ended March 31, 2005, and June 30, 2005, to reflect the restated information. Restated Consolidated Financial Statements for the years ended December 31, 2002, 2003, and 2004 are attached as Exhibit 99.1.
Investor Verification Checklist
- Verify the reclassification of restricted cash deposits from operating to investing activities in the restated cash flow statements.
- Confirm that the restatement does not alter net income, total assets, or total liabilities.
- Monitor upcoming filings for amended Form 10-Q reports for the first and second quarters of 2005.
- Review Exhibit 99.1 for the full restated financial statements and the independent auditor's report.