Financial Restatement

Burling ton Coat manufactory opened its doors in 1972 specializing mainly on coats in Burlington, New Jersey. Over the years, the company evolved in turn mens and womens suits, sportswear, shoes, and accessories (Burlington, 2009). The company now has over 394 stores in 44 states. Burlington Coat Factory excessively owns botch up Depot, Luxury Linens and Cohoes. On April 5, 2005, Burlington Coat Factory announced that its financial statements need restatement due to certain operating lease relieve oneself matters (Burlington, 2005). Based on review from its accounting firm and audit, the bon ton decided to revise its method of accounting for operating leases (Burlington, 2005). The leases that be possessed of renewal options only, the Company recorded rent depreciate on a straight-line nates over the fixed sign name, with the term commencing when rental payments actually began, and computed depreciation/amortization on the link up leasehold improvements and othe r long-lived assets located on these properties over their helpful lives (Burlington, 2005). The Company decided to revise this reference of method to recognised rent expenses on a straight-line basis over the pass judgment lease term, including holidays (Burlington, 2005).

These results give non affect historical or future cash flows or timing of payment nether pertinent leases. The Company has also decided to revise the instruction it accounts for lease incentives. Lease incentives certain from the lesser for the reimbursement of costs of leasehold improvements were webby against the incurred capital exp enditures. By rewriting the financial state! ment, the accounting will record the lease incentives as deferred rent and amortize them over the length of the lease. Burlington Coat Factory will revise its yearly reports, forms 10-K and forms 10-Q, with the Securities and Exchange Commission (SEC) to ruminate the restated financial statements.If you want to consume a full essay, rule it on our website: BestEssayCheap.com

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