Wednesday, March 5, 2014
Ixia Completes Audit, Investigation, Swaps CFO
Calabasas-based Ixia said late Monday that it has completed its investigation into the company's finances and business, which came out of the October 2013 surprise resignation of the company's President and CEO. According to Ixia, after retaining independent counsel and a forensic accounting advisory firm, the company found that there was no intentional misconduct with respect to the company's financial results or financial statements; however, Ixia did say it identified errors in the company's revenue recognition.
As part of that, Ixia said its CFO for the last fourteen years--Tom Miller--has resigned, and that it will be shifting revenue for each of the quarters for its 2012 fiscal year and March 31, 2013 and June 30, 2013 quarters. Ixia blamed the revenue recognition issues with "an aggressive tone" set by its former CEO, a "lack of leadership" with respect to its resigned CFO, and "insufficient resources, controls, and training" of its personnel with respect to revenue recognition. Miller will be replaced by current Senior Vice President of Finance, Brent Novak, who will serving as acting CFO.
Ixia said the financial errors would not affect the total revenue of the company, but would represent a shift of between 0% and 3% of revenue between quarters. The company said the errors came via inappropriate assessment of multi-element sales transactions and extensions of payment terms beyond customary terms.
Ixia's troubles came to light with the surprise resignation of CEO Vic Alston back in October, due to the company discovering that Alston had fabricated his academic credentials.