Restatement of Financials

Form 10-Q is lied pull outly by a company and Form 8-K contains trustworthy reports that disclose specific events. If a company is audited and weaknesses are found, restatements to these statements may be necessary. In the case of the States Mobility, auditors did identify some areas that warranted a restatement while conducting and audit in the first quarter of 2013 the companys financial statements for the 2012 reporting year.the States Mobility Audit Committee determined through the audit performed that a material weakness in national control over financial reporting and disclosure was identified within Amoco Software Incorporated that is owned and operated by USA Mobility. Amoco Software was acquired by USA Mobility on March 2, 2011. The auditors revealed Mammons procedures in place for revenue recognition were poorly designed and did not allow for proper internal controls to be utilized. Revenue was cosmos recognized by the company during quarters when it should not have be en recognized.Upon this finding, USA Mobility had to determine the correct timeshare to recognize revenue for its package segment. Prior to the audit, the revenue for software program operations was being recognized by using the residual method and the company would recognize revenue for software licenses upon completion of services. The company deemed services write out when the product was available for habit by the customer. In addition, the company offered services after installations were completed for up to 90 days. Since the company offers post-install services, revenue recognition should be delayed until after that period expires.This determination was made when reviewing audit findings to erect prior report revenue. The reported periods affected by this finding were the first trey quarters of 2011. USA Mobility issued a press release which contained notification of the restatements for the first three quarters of 2011 and the late filing of the 2011 annual report for t he company. Specifically, the company turn to the changes to the financial statements in a press release. The main changes made to the financial statements affected software revenue and total revenue for the company.In the first quarter of 011 , the software segment revenue was adjusted from $4,799,000. 00 down to $2,146,000. 00. That is a decrease of 55%. In the second quarter, the software segment revenue was adjusted from down to $9,435,000. 00. That is a decrease of 28%. In the third quarter, the software segment revenue was adjusted from down to $11,191 ,OHO. O. That a decrease of 13%. USA Mobility also reported adjustments caused by the restatement to its total revenue for 2011. The first quarter revenue of $57,335,000. 00 was rock-bottom by five percent because of the restatement.The second quarter revenue of $65,171 ,OHO. O was decreased by six percent and the third quarter revenue of $61 was decreased by three percent. The collective revenue of $242,907,000. 00 for 2011 w as decreased by quartet percent as a result of the companys restatement. USA Mobility balance sheet also had to be adjusted. Deferred revenue was affected during each quarter during 2011. Each quarter showed a higher deferred revenue amount as a result of the correct method the company was using to recognize revenue to remain in compliance.The overall effects of the restatement were limited to the software segment of the company. In turn, these changes also affected the overall revenue numbers and the way the company reports deferred revenue for prox purposes. The reduction in revenue did not have a negative impact on stockholders earnings. The price of stock per share has remained steady prior to and since the announcement. USA Mobility did publish a press release to inform all parties with an interest about measures the company has taken to rectify the situation and will continue to use to remain in compliance for future audits.