eastunder
10 years ago
Ventas official's 'inappropriate' relationship doesn't shake its stock
http://www.chicagobusiness.com/article/20140711/NEWS03/140719950/ventas-officials-inappropriate-relationship-doesnt-shake-its-stock
The market's reaction to Ventas Inc.'s news this week that it severed ties with its auditing firm seems to be a resounding “meh.”
The Chicago-based real estate investment trust on July 9, via statement and regulatory filing, said it would no longer be a client of Ernst & Young LLP after the New York-based accounting giant notified it of an “inappropriate personal relationship” between an Ernst & Young senior audit partner and Ventas' now-former chief accounting officer and controller Robert Brehl.
In light of the relationship, Ernst & Young said it could no longer be considered an independent auditor. Now Ventas' new auditing firm, KPMG LLP, must re-audit its results from 2012 and 2013, though the company says financial statements from the period accurately reflect the state of the enterprise. Ventas also says that Mr. Brehl's separation was “not due to any disagreement . . . regarding its financial reporting or accounting operations, policies or practices.”
The reported results, the company said in a statement, “may continue to be relied upon.”
The market apparently agrees. On Thursday, the day after news of the dismissal of Ernst & Young — and its unusual cause — went public, Ventas' stock inched up less than a half-percent, and as of this afternoon, it was trading at $64.10, about 0.3 percent higher than it was at the beginning of the week.
THE LONG VIEW
Fitch Ratings Inc. today reaffirmed its BBB+ rating on Ventas' debt and said it “does not expect the announcement to result in a change in the company's long-term credit profile.”
In the short term, the ratings agency noted, the news may present some complications because Ventas cannot issue stock while KMPG is re-auditing the company's books. Ventas in June announced the acquisition of American Realty Capital Healthcare REIT for $2.6 billion in cash and 26.9 million shares of stock. The deal is set to close in the fourth quarter.
Fitch, however, said it expects the new audits to be done “well in advance” of the acquisition.
A REIT, Ventas owns and operates a portfolio of about 1,500 health care properties in 47 states, Canada and the United Kingdom. It booked $2.81 billion in revenue in 2013.
A spokeswoman for Ventas declined to comment on the matter beyond the company's press release and its 8-K filing with the Securities and Exchange Commission.
'PROMPTLY TERMINATED'
A spokesman for Ernst & Young in New York said the audit partner involved in the relationship with Mr. Brehl was no longer with the company.
"This partner's actions were a flagrant violation of our firm's code of conduct and professional standards,” John La Place, assistant director of brand, marketing and communications, wrote in an email. “Upon our learning of this matter, the partner was promptly terminated.”
The partner could not be reached for comment. In its SEC filing, the firm said the official was the lead audit partner on the 2014 audit and quarterly review and worked on the 2012 and 2013 audits.
Mr. Brehl also could not be reached for comment. As of March, he owned about 21,000 shares of the company, according to Bloomberg LP.
eastunder
10 years ago
Now here's an 8-k filing! LOL Haven't seen this one before.
http://ih.advfn.com/p.php?pid=nmona&article=62884183&symbol=VTR
VENTAS DISMISSES ERNST & YOUNG AS AUDITOR DUE TO
ERNST & YOUNG’S DETERMINATION IT LACKS INDEPENDENCE AND WITHDRAWAL OF ITS 2012 AND 2013 AUDIT REPORTS
Company Believes Historical Financial Results are Accurate in All Material Respects and Internal Control Over Financial Reporting was Effective
Company Appoints KPMG LLP as Its Independent Public Auditor
Company Expects At Least $1.09 Normalized Funds From Operations (“FFO”)
Per Diluted Share in Second Quarter 2014
CHICAGO, IL — July 9, 2014 — Ventas, Inc. (NYSE: VTR) (“Ventas” or the “Company”) today announced that the Company has dismissed Ernst & Young (“E&Y”) as its public accounting firm, effective July 5, 2014, due to E&Y’s determination that it was not independent solely as a result of an inappropriate personal relationship between an E&Y partner and Ventas’s former Chief Accounting Officer and Controller. Ventas also announced that, following such dismissal, its Audit Committee has engaged KPMG LLP (“KPMG”) as the Company’s independent public accounting firm.
E&Y has advised the Company that, solely due to the inappropriate personal relationship, it determined that it was not independent of the Company during the periods in question. As a result of such determination, E&Y stated that it was obligated under applicable law and professional standards to withdraw (and it has withdrawn) its audit reports on the Company’s financial statements for the years ended December 31, 2012 and 2013, and its review of the Company’s results for the quarter ended March 31, 2014. E&Y’s decision to withdraw such audit reports and review was made exclusively due to the personal relationship in question, and not for any reason related to Ventas’s financial statements, its accounting practices, the integrity of Ventas’s controls or for any other reason.
Ventas believes that the Company’s financial statements present fairly, in all material respects, the financial condition, results of operations and cash flows of the Company as of the end of and for the referenced periods, and may continue to be relied upon. The Company also believes that its internal control over financial reporting was effective during those periods. Ventas noted that the senior E&Y partner on the Ventas account, who signed the 2012 and 2013 audit reports, was not the individual involved in the inappropriate personal relationship.
As the Company’s new independent public accounting firm, KPMG has been engaged to complete a re-audit and re-review of the relevant periods. The Company will devote all necessary resources to facilitate KPMG’s completion of its work on an expedited basis. There can be no assurance that KPMG will reach the same conclusions as E&Y regarding the application of accounting standards, management estimates or other factors affecting the Company’s financial statements.
The Company also announced today the separation of Robert J. Brehl from his position as Ventas’s Chief Accounting Officer and Controller in relation to these matters. Mr. Brehl’s separation from the Company was not due to any disagreement with the Company regarding its financial reporting or accounting operations, policies or practices.
“Ventas stands for integrity, reliability and transparency with investors, lenders, employees and other stakeholders,” stated Ventas Chairman and Chief Executive Officer Debra A. Cafaro. “When we learned of this isolated situation, we investigated the facts immediately, notified E&Y promptly and took swift and decisive action.
“Our team of experienced professionals remains focused on executing our strategic plan, including completion of our two previously announced acquisitions of American Realty Capital Healthcare Trust, Inc. and the 29 independent living seniors housing communities located in Canada from Holiday Retirement, in accordance with their terms.”
Richard A. Schweinhart, Executive Vice President and Chief Financial Officer of the Company, has assumed Mr. Brehl’s responsibilities and will serve as the Company’s Acting Chief Accounting Officer. To the extent requested by the Company and the Ventas Board of Directors, Mr. Schweinhart has also agreed to modify and/or defer his previously announced retirement plans to ensure completion of the re-audit work and a smooth transition to his successor.
VENTAS ISSUES SECOND QUARTER 2014 NORMALIZED FFO GUIDANCE
Ventas said that it currently expects its second quarter 2014 normalized FFO per diluted share to be at least $1.09. The Company’s guidance represents at least eight percent per share growth in normalized FFO compared to the comparable 2013 period. A reconciliation of the Company’s guidance to the Company’s projected GAAP earnings is attached to this press release.
The Company expects to release financial results for the second quarter 2014 within the customary second quarter reporting cycle.
Mr. Schweinhart said, “Our financial position remains strong and we look forward to reporting our second quarter results. I have confidence in the professionalism and commitment of my team, and we are fully engaged to ensure that KPMG will be able to complete its work.”
The Company’s normalized FFO guidance (and related GAAP earnings projections) for all periods assumes, with certain immaterial exceptions, that all of the Company’s tenants and borrowers continue to meet all of their obligations to the Company. In addition, the Company’s normalized FFO guidance excludes, other than as specifically stated, (a) net gains on the sales of real property assets, including gain on re-measurement of equity method investments, (b) merger-related costs and expenses, including amortization of intangibles, transition and integration expenses, and deal costs and expenses, (c) the impact of any expenses related to asset impairment and valuation allowances, the write-off of unamortized deferred financing fees, or additional costs, expenses, discounts, make-whole payments, penalties or premiums incurred as a result of early retirement or payment of debt, (d) the non-cash effect of income tax benefits or expenses and derivative transactions that have non-cash mark-to-market impacts on the Company’s income statement, (e) the impact of future unannounced acquisitions or divestitures (including pursuant to tenant options to purchase) and capital transactions, (f) the financial impact of contingent consideration, severance-related costs, charitable donations made to the Ventas Charitable Foundation, gains and losses for non-operational foreign currency hedge agreements and changes in the fair value of financial instruments and (g) expenses related to the re-audit and re-review of the Company’s historical financial results and related matters.
The Company’s guidance is based on a number of other assumptions that are subject to change and many of which are outside the control of the Company. If actual results vary from these assumptions, the Company’s expectations may change. There can be no assurance that the Company will achieve these results. The Company may from time to time update its publicly announced guidance, but it is not obligated to do so.
Ventas, Inc., an S&P 500 company, is a leading real estate investment trust. Its diverse portfolio of nearly 1,500 assets in 47 states (including the District of Columbia), two Canadian provinces and the United Kingdom consists of seniors housing communities, medical office buildings, skilled nursing facilities, hospitals and other properties. Through its Lillibridge subsidiary, Ventas provides management, leasing, marketing, facility development and advisory services to highly rated hospitals and health systems throughout the United States. More information about Ventas and Lillibridge can be found at www.ventasreit.com and www.lillibridge.com.
Penny Roger$
13 years ago
Ventas, Inc. is a real estate investment trust (REIT) with a portfolio of seniors housing and healthcare properties in the United States and Canada. Its primary business consists of acquiring, financing and owning seniors housing and healthcare properties and leasing those properties to third parties or operating those properties through independent third-party managers. Through its Lillibridge Healthcare Services, Inc. subsidiary, it also provides management, leasing, marketing, facility development and advisory services to hospitals and health systems throughout the United States. As of December 31, 2010, its portfolio consisted of 602 assets, 240 seniors housing communities, 187 skilled nursing facilities, 40 hospitals and 135 medical office buildings (MOBs) and other properties in 43 United States’ states, the District of Columbia and two Canadian provinces. It has three segments: triple-net leased properties, senior living operations and MOB operations.
http://www.google.com/finance?q=VTR
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whytestocks
4 years ago
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