First Financial Restating 9-Month Profits
ATLANTA - First Financial Management Corp. said Friday that it is restating earnings for the first nine months of 1991 because of inaccurate accounting at a bank data processing subsidiary.
Net income for the nine months is being reduced by $6.4 million, or 10%, to $55.4 million. The per-share figure drops to $1.73, from $1.92.
First Financial Management, a holding company in the computer service, transaction processing, and thrift businesses, said accounting errors affected the reporting of revenue and expense accruals at Basis Information Technologies. Basis provides data processing services to financial institutions.
Reports Being Amended
First Financial said it is in the process of filing amended quarterly reports to the Securities and Exchange Commission to correct those errors.
Among the company's other subsidiaries is Georgia Federal Bank, the largest thrift in the state, with $4.5 billion in assets.
"The accounting discrepancies were discovered in the course of the internal accounting and auditing process at FFMC and have been thoroughly investigated by FFMC in consultation with Deloitte & Touche, its independent auditors," said Patrick H. Thomas, chairman.
He said there was no evidence of any misappropriation of funds, "and we are confident that we have the problems fully identified and corrected."
The discrepancies, he added, have no effect on an effort by Basis and International Business Machines Corp. to develop banking software now in pilot tests at banks and due to be marketed beginning next spring.
First Financial said it expects fourth-quarter 1991 earnings to be 90 cents to $1 a share.
For the full year, the earnings after restatement are projected at $2.65 to $2.75 a share.