NEW YORK, / ACCESSWIRE / December 21, 2019 / Pomerantz LLP is investigating claims on behalf of investors of Baxter International Inc. ("Baxter" or the "Company") (NYSE: BAX) Such investors are advised to contact Robert S. Willoughby at [email protected] or 888-476-6529, ext. 9980.
The investigation concerns whether Baxter and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
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On October 24, 2019, Baxter announced that it "recently began an investigation into certain intra-Company transactions undertaken for the purpose of generating foreign exchange gains or losses." According to the Company, "[t]hese transactions used a foreign exchange rate convention historically applied by the Company that was not in accordance with generally accepted accounting principles [("GAAP")] and enabled intra- Company transactions to be undertaken after the related exchange rates were already known."
Baxter further admitted that "[t]hese intra-Company transactions resulted in certain misstatements in the Company's previously reported non-operating income related to net foreign exchange gains" and acknowledged that, "[u]pon completion of the investigation and the Company's evaluation of the materiality of the misstatements, the Company expects to either amend its periodic reports previously filed with the Securities and Exchange Commission ("SEC") to include restated financial statements that correct those misstatements, or include in reports for future periods restated comparative financial statements that correct those misstatements." As noted in the announcement, "the Company previously reported net foreign exchange gains of $8 million, $113 million, $28 million, $50 million, $73 million, and $22 million, for the years 2014, 2015, 2016, 2017, 2018, and the first half of 2019, respectively."
The Company further explained that "[t]he Audit Committee of the Company's Board of Directors is overseeing this investigation with the assistance of independent, experienced external advisors," that "Baxter voluntarily advised the staff of the [SEC] that the internal investigation is underway and intends to provide additional information to the SEC as the investigation progresses," and that "[t]he Company does not expect to file its quarterly report on Form 10-Q for the period ended September 30, 2019 on a timely basis." On this news, Baxter's stock price fell $8.87 per share, or 10.09%, to close at $87.985 per share on October 24, 2019.
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SOURCE: Pomerantz LLP