InteliData Technologies Corp., a vendor of online bill-payment software, said its controls on preparing financial reports are inadequate.
But Corillian Corp., the online banking technology vendor that agreed in May to buy it, is "still moving forward with the acquisition," said Steve Shaw, a Corillian spokesman, on Thursday.
InteliData said last week in an amendment to its 2004 annual report that it "did not maintain effective internal control over financial reporting" and that its "controls with respect to the process of preparing and reviewing the annual and interim financial statements are ineffective." The amendment was filed with the Securities and Exchange Commission; the original 2004 report was filed March 31.
InteliData said that its three accountants "lacked the technical skills" to properly document the company's earnings, and that "there is more than a remote likelihood that a material misstatement in our annual or interim financial statements could occur and would not be prevented or detected."
The filing said that InteliData is taking no steps to correct these lapses but is devoting its resources instead to completing the merger with Corillian.
"At this time InteliData has not devised a plan to address its material weaknesses. If the merger with Corillian is not consummated, InteliData's management will undertake to devise such plans and, if appropriate, report those plans in a future filing," the company said.
Corillian said in March that it would pay about $20 million in cash and stock to purchase InteliData; InteliData's shareholders are expected to vote on the deal at its annual meeting Aug. 18.
Corillian hopes "that they vote 'yes' in August," Mr. Shaw said.
InteliData is based in Reston, Va.; Corillian is based in Portland, Ore.
