Accounting errors at Hertz
17 November 2014
Hertz, the car rental business that owns Hertz Equipment Rental Corp (HERC), said it has discovered accounting errors in its financial reporting.
The company said its financial statements for 2011 should be restated and that the 2012 and 2013 financial statements needed to be revised.
The audit committee was also investigating “certain accounting errors” – it has been looking into the tone at the top influence and the involvement and oversight that members of the Hertz organization may have had on those potential errors, according to a company filing with the US Securities and Exchange Commission (SEC).
“The most material errors identified to date relate primarily to the capitalisation and timing of depreciation for certain non-fleet assets, allowances for doubtful accounts in Brazil, allowances for uncollectible amounts with respect to renter obligations for damaged vehicles, restoration obligations at the end of facility leases and certain other items,” Hertz said, adding that the review and investigation of the financial records was ongoing.
It also said some of the adjustments identified to date would effect years prior to 2011. It said it did not expect to file updated financial statements before mid-2015.
The news came after Hertz warned in an SEC filing earlier this month that it was “unable to timely file its quarterly report” for the three months ending 30 September, 2014.