Catalina Marketing Corporation Receives Response From SEC Staff
March 18 2004 - 5:13PM
PR Newswire (US)
Catalina Marketing Corporation Receives Response From SEC Staff ST.
PETERSBURG, Fla., March 18 /PRNewswire-FirstCall/ -- Catalina
Marketing Corporation today announced that it has received a
response from the Office of the Chief Accountant of the Securities
and Exchange Commission (SEC) in connection with a key element of
the company's historical revenue recognition methodology.
Specifically, the Staff of the Office of the Chief Accountant
stated that it does not object to the company's historical revenue
recognition methodology for certain company transactions with
consumer packaged goods manufacturers governed by operating
contracts with "exclusivity" provisions. As a result, no
adjustments to the financial statements related to the timing of
revenue recognition specifically related to exclusivity in the
Catalina Manufacturer Services division will be required. As
previously disclosed, Catalina's former independent auditor, Ernst
& Young LLP (E&Y), resigned as the company's auditor on
August 20, 2003. In correspondence to the SEC dated September 9,
2003, E&Y stated that there was a "disagreement" between the
company and E&Y relating to "the company's accounting treatment
with respect to certain exclusivity rights granted to customers for
the contractual periods of its arrangements."
PricewaterhouseCoopers (PwC) was retained as the company's
independent auditor in October 2003 and, following a review of the
company's revenue recognition policies relating to these
exclusivity rights, concurred that the company's accounting
treatment for these rights is appropriate. Thereafter, the company
contacted the Office of Chief Accountant to seek its review and
concurrence regarding the appropriate accounting treatment for the
exclusivity rights. "We appreciate the SEC's timely response
regarding this matter," stated Christopher W. Wolf, executive vice
president and chief financial officer. "We are pleased to report
that the audits are progressing and the favorable resolution of
this particular revenue recognition issue regarding exclusivity
rights will help expedite the process. The company's Audit
Committee and management are working with PwC to complete the
audits. While the time required to complete the audits cannot be
determined, we look forward to sharing those results with our
investors as soon as possible." As previously disclosed by the
Company, at the time of E&Y's resignation, there were several
"reportable events" relating to other financial accounting matters
that hadbeen identified. The company is reviewing the accounting
issues underlying these other reportable events, and is addressing
all such issues, as appropriate, with PwC. Unlike the exclusivity
issue review, which has been completed, the review of the other
four reportable events previously disclosed is ongoing and thus the
company is making no announcement at this time regarding those
items. Catalina Marketing can give no assurance that these
remaining "reportable events", or any other issues that arise as
part of the audit of its fiscal year ended March 31, 2003 and the
re-audits of fiscal years 2002 and 2001, will not result in a
restatement of its prior year financial statements. The fact that
the exclusivity issue was resolved favorably should not be
construed as an indication that the other reportable events or
other items in the audit will likewise be resolved favorably. Due
to the ongoing review of these matters and the status of these
audits, previously filed financial statements, including the
associated audit opinions and review reports of the company, should
not be relied upon until the company files it annual report for the
year ended March 31, 2003 on Form 10-K. Based in St. Petersburg,
FL., Catalina Marketing Corporation
(http://www.catalinamarketing.com/) was founded 20 years ago based
on the premise that targeting communications based on actual
purchase behavior would generate more effective consumer response.
Today, Catalina Marketing combines unparalleled insight into
consumer behavior with dynamic consumer access. This combination of
insight and access provides marketers with the ability to execute
behavior- based marketing programs, ensuring that the right
consumer receives the right message at exactly the right time.
Catalina Marketing offers an array of behavior-based promotional
messaging, loyalty programs and direct to patient information.
Personally identifiable data that may be collected from the
company's targeted marketing programs, as well as its research
programs, are never sold or given to any outside party without the
express permission of the consumer. Certain statements in the
preceding paragraphs are forward looking, and actual results may
differ materially. Statements not based on historic facts involve
risks and uncertainties, including, but not limited to, the
changing market for promotional activities, especially as it
relates to policies and programs of packaged goods manufacturers
for the issuance of certain product coupons, the effect of economic
and competitive conditions and seasonal variations, actual
promotional activities and programs with the company's customers,
the pace of installation of the company's store network, the
success of new services and businesses and the pace of their
implementation, the company's ability to maintain favorable client
relationships, the timing of completion of the company's audits,
the nature and extent of any changes to the company's audits and
reaudits, the outcome and impact of the ongoing SEC investigation,
the outcome of the resolution of the other reportable events
disclosed in the company's Form 8-K dated August 20, 2003, and the
outcome and impact of the pending shareholder class action.
DATASOURCE: Catalina Marketing Corporation CONTACT: Investors,
Christopher W. Wolf, Executive Vice President and Chief Financial
Officer, +1-727-579-5218, or Joanne Freiberger, Vice President,
Finance, +1-727-579-5116, or Media, Susan Gear, Executive Director,
Marketing, +1-727-579-5452, all ofCatalina Marketing Web site:
http://www.catalinamarketing.com/
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