American Renal Associates says Audit Committee review is continuing

As previously disclosed, in October 2018, the Staff of the Securities and Exchange Commission requested that the Company voluntarily provide documents and information relating to certain revenue recognition, collections and related matters. Following receipt of the SEC request, the Company responded by producing documents and information to the Staff and expects to continue to cooperate with the SEC by providing additional documents and information to the Staff in the future. In addition, the Audit Committee of the Board of Directors of the Company began an examination of the Company’s revenue recognition methodology and related accounting matters, such as internal control over financial reporting related to revenue recognition and related matters, with the assistance of legal counsel that reports to the Audit Committee, as well as independent accounting advisors retained by the Audit Committee’s counsel. The Audit Committee’s review is continuing. With the assistance of its advisors, the Audit Committee is examining reserve computations and other accounting practices that could have an impact on accounts receivable and revenue for the fiscal year ended December 31, 2018, as well as the previously reported fiscal years ended December 31, 2014, 2015, 2016 and 2017, the fiscal quarters within those fiscal years and the first three fiscal quarters of 2018. The Audit Committee is continuing to evaluate whether and how any such adjustments will affect individual quarters and years during the affected period, and the Company does not expect to comment further on the Audit Committee’s review until it is completed. However, the Company currently believes that the filing of its 2018 Form 10-K will be delayed and has informed the Company’s independent registered public accounting firm and the Staff of the SEC accordingly. The Audit Committee and the Board are continuing to evaluate these matters and are working diligently to complete their review so that the Company can file its 2018 Form 10-K and make any related disclosures as promptly as practicable.
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