AngioDynamics, Inc. (NASDAQ:ANGO) Files An 8-K Other EventsItem 8.01 –Other Events
AngioDynamics, Inc.’s (the “Company”) management has been informed by PricewaterhouseCoopers LLP (“PwC”), its former independent registered public accounting firm, following an inspection by the Public Company Accounting Oversight Board of PwC’s audit of the May 31, 2016 financial statements and internal controls over financial reporting, that the Company’s internal control over financial reporting as of May 31, 2016 was not effective because the material weakness described below existed as of that date.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. PwC has now determined that there was a material weakness in the Company’s internal control over financial reporting as of May 31, 2016 because the Company did not design and maintain effective internal controls over the accounting for the annual goodwill impairment test. Specifically, the Company did not design and maintain effective controls to review in sufficient detail the cash flow projections and significant valuation model assumptions used in the goodwill impairment test as of December 31, 2015.
Management of the Company, after discussions with PwC and the Audit Committee, determined that Management’s Report on Internal Control over Financial Reporting included in the Company’s Annual Report on Form 10-K for the fiscal year ended May 31, 2016 should no longer be relied upon due to the material weakness specifically related to the goodwill impairment test noted above.
The material weakness described above did not result in a misstatement of the consolidated financial statements for the year ended May 31, 2016 or any interim periods in 2016 and 2017. As of May 31, 2017, management has concluded that the material weakness described above has been remediated.Specifically, the following actions were taken to remediate the material weakness:
The annual goodwill impairment test control was updated to ensure that the control was designed appropriately to include sufficient procedures to be performed. Specifically, if the discounted cash flow method was required for performing the goodwill impairment test, detailed procedures over the cash flow projections and valuation model assumptions are detailed in the control wording.
Sufficient and appropriate detailed documentation was prepared over the goodwill impairment testperformed as of December 31, 2016.
A Form 10-K/A for the year ended May 31, 2016 will be issued solely to revise PwC’s opinion on internal controls over financial reporting and Management’s Report on Internal Control over Financial Reporting and its evaluation of disclosure controls and procedures to reflect the conclusions by the Company’s management that internal control over financial reporting and disclosure control and procedures were not effective as of May 31, 2016. In addition, Form 10-Q/A’s will be issued for the first three quarters of fiscal year 2017, again, solely to revise Item 4 and its evaluation of disclosure controls and procedures to reflect the conclusions by the Company’s management that internal control over financial reporting and disclosure controls and procedures were not effective as of the end of the period covered by each report.
About AngioDynamics, Inc. (NASDAQ:ANGO)
AngioDynamics, Inc. designs, manufactures and sells a range of medical, surgical and diagnostic devices used by professional healthcare providers for vascular access, for the treatment of peripheral vascular disease and for use in oncology and surgical settings. The Company’s devices are used in minimally invasive, image-guided procedures. The Company offers products within three product groupings: Peripheral Vascular, Vascular Access and Oncology/Surgery. The Company’s Peripheral Vascular products include Fluid Management, Venous, Thrombus Management, as well as other core products. The Company’s BioFlo products incorporate Endexo Technology into the manufacturing and design of its Vascular Access products. Its Oncology/Surgery product offerings include its Microwave Ablation products, Radiofrequency Ablation (RFA) and its NanoKnife product lines.