JOHNS CREEK, Ga., Feb. 19, 2021 (World NEWSWIRE) — Ebix, Inc. (NASDAQ: EBIX), a major international supplier of On-Desire software package and E-commerce expert services to the insurance plan, fiscal, health care and e-understanding industries, these days issued a press launch to emphasize a strong present business enterprise outlook while talking about the auditor resignation, the profits materiality of the troubles highlighted, and the several associated actions being taken by the Business.
By letter dated February 15, 2021, RSM US LLP (“RSM”) notified the Audit Committee of the Board of Directors (the “Audit Committee”) of Ebix, Inc. (the “Company”) of its resignation as the Company’s unbiased registered community accounting organization, as the Corporation spelled out in its Variety 8-K filed these days.
RSM stated in its letter that its resignation was the “result of becoming unable, even with recurring inquiries, to attain enough ideal audit proof that would allow for it to examine the organization purpose of major abnormal transactions that occurred in the fourth quarter of 2020.” RSM informed the Company that the uncommon transactions relevant to the Company’s present card organization in India. RSM also stated in its letter that it had identified a materials weakness due to the fact “management did not design and style or put into action the required treatments and controls above the present or prepaid card income transaction cycle enough to avoid or detect a product misstatement.”
RSM also knowledgeable the Company that there was a disagreement with respect to the classification of $30 million held in a have faith in account for the reward of the Enterprise. In connection with a pending acquisition, in December 2020 the Company transferred $30 million to a trust account of its outdoors lawful counsel. There have been no constraints on the Company’s ability to have the funds returned, and in truth, following RSM opined on the challenge of classification of these resources, the Corporation experienced the cash returned on February 2, 2021. RSM educated the Enterprise that it thought that these cash must be classified on the equilibrium sheet beneath the “Other Present-day Asset” line merchandise of the financials, alternatively of currently being categorized as hard cash as the Corporation had to begin with classified it. There were being communications with RSM on this problem right after which the Company was well prepared to classify the $30 million held in the rely on account at December 31, 2020 as a latest asset. The Business deemed this problem to be an preliminary variance of view primarily based on incomplete information or preliminary details instead than a “disagreement” pursuant to Product 304(a)(1)(iv).
The Company’s unaudited benefits right before any one-time unusual things or audit adjustments for the fourth quarter of 2020 features revenues better than $220 million and working revenue and running dollars movement metrics every in extra of $32 million. Of these amounts, the Firm’s unaudited present card company generated in excessive of $130 million of revenues in the fourth quarter, symbolizing sequential earnings growth in the present card business of better than 95% versus the 3rd quarter of 2020. The corresponding Q4 2020 present card small business running revenue was considerably less than $1 million.
For the full yr 2020, working income from the gift card enterprise was a lot less than $1.4 million. The expansion in the reward card enterprise revenues was pushed by the enhanced use of electronic revenue in India for the duration of the Covid-19 pandemic and the renewed drive by the Business to increase its payment alternatives company.
The Chair of the Audit Committee talked about with RSM the explanations for its resignation. Though the Enterprise does not concur with specified statements made by RSM in its resignation letter dated 2/15/21, the board has engaged exterior counsel who, alongside with accounting industry experts, will guide the Enterprise with respect to these issues.
RSM was engaged by the Audit Committee on December 21, 2018 to provide as the Firm’s unbiased auditor for fiscal 12 months ending December 31, 2019 and was engaged all over again on June 12, 2020 to serve as the Firm’s independent auditor for fiscal 12 months ending December 31, 2020. RSM’s previously issued stories on the Company’s consolidated money statements and the Firm’s interior controls around money reporting for the fiscal yr ended December 31, 2019 did not contain an adverse viewpoint or a disclaimer of feeling nor ended up they experienced or modified as to uncertainty, audit scope, or accounting principles. As of February 15, 2021, RSM had not finished its audit strategies or issued any reviews on the Company’s consolidated economical statements and inside controls about financial reporting for the fiscal yr ended December 31, 2020.
The Business intends to move as immediately as possible to change RSM and to total its 2020 economical audit. The Business thinks that the accounting for its present card organization is steady with GAAP prerequisites. The Firm will converse with its public shareholders as ideal.
About Ebix
With a “Phygital” tactic that combines 320,000 physical distribution shops in quite a few Southeast Asian Nations (“ASEAN”) nations around the world, to an Omni-channel on the web electronic platform, the Company’s EbixCash Financial trade portfolio encompasses leadership in regions of domestic & intercontinental money remittance, overseas trade (Foreign exchange), journey, pre-paid & gift playing cards, utility payments, lending, wealth administration and many others. in India and other marketplaces. EbixCash’s Forex functions have emerged as a chief in India’s airport Foreign Exchange business enterprise with operations in 32 global airports such as Delhi, Mumbai, Bangalore, Hyderabad, Chennai and Kolkata, conducting in excess of $4.8 billion in gross transaction benefit for every 12 months. EbixCash’s inward remittance business in India conducts approx. $6.5 billion gross once-a-year remittance small business, confirming its undisputed leadership posture in India. EbixCash, by its journey portfolio of Via and Mercury, is also just one of Southeast Asia’s major travel exchanges with around 2,200+ workforce, 212,450+ agent network, 25 branches and in excess of 9,800 company shoppers processing an believed $2.5 billion in gross merchandise value for every 12 months. EbixCash’s Money Technologies remedies are today deployed across prestigious money institutions and Banking companies in 44 nations. For a lot more facts, pay a visit to the Company’s internet site at www.ebixcash.com
With 50+ workplaces throughout 6 continents, Ebix, Inc., (NASDAQ: EBIX) endeavors to supply On-Desire computer software and E-commerce expert services to the coverage, financial, healthcare and e-finding out industries. In the Insurance policies sector, Ebix’s main focus is to build and deploy a large variety of insurance coverage and reinsurance exchanges on an on-demand foundation, although also, offering Software-as-a-Support (“SaaS”) enterprise alternatives in the spot of CRM, front-end & back-close units, outsourced administration and risk compliance providers, around the world. For a lot more information and facts, check out the Company’s website at www.ebix.com
Ahead Seeking STATEMENTS
This push launch includes specific statements that are “forward-looking” statements inside of the meaning of the federal securities legislation, which include Section 27A of the Securities Act of 1933, as amended, and Part 21E of the Securities Trade Act of 1934, as amended. These ahead-looking statements are based mostly upon present-day expectations and include all statements that are not historical statements of actuality and these concerning the intent, perception or anticipations, like, with no limitation, statements that are accompanied by terms such as “will,” “believes,” “anticipates,” “plans,” “expects,” “intends,” “estimates,” “seeks,” “may” or other comparable text, phrases or expressions and versions or negatives of these terms. Readers of this press launch really should recognize that these statements are not assures of performance or success. Several threats and uncertainties could have an impact on true success and induce them to vary materially from the anticipations contained in the ahead-hunting statements. Actual final results could vary materially from all those contemplated by the ahead-wanting statements as a final result of specified aspects, which includes but not confined to, people talked about in our Once-a-year Report on Type 10-K and subsequent reports submitted with the SEC, as very well as: the opportunity impacts of RSM’s resignation the potential to, as properly as the potential to well timed, have interaction a new unbiased registered public accounting firm the threat of litigation or regulatory motion arising from these matters, from the failure to well timed file the Annual Report on Sort 10-K for the fiscal year ended December 31, 2020 (the “Annual Report”) or from the resignation of the RSM the timing of the assessment by, and the conclusions of, the Company’s new unbiased auditor with regards to these matters and its impact on the economical statements doable default by the Business below its credit facility the capacity of the Company to remediate any substance weaknesses in inside manage more than monetary reporting potential reputational damage that the Company could suffer as a outcome of these matters or the resignation of RSM the impact of these issues and the resignation of RSM on the benefit of the Company’s inventory and the possibility that the submitting of the Yearly Report will acquire for a longer time than expected. Readers are cautioned not to area undue reliance on these forward-on the lookout statements. Any ahead-searching statement made by us speaks only as of the date of this report. Except needed by law, the Business does not undertake to launch publicly any revisions to these ahead-wanting statements to reflect potential occasions or conditions or to reflect the incidence of unanticipated events.
Make contact with:
Darren Joseph
[email protected] or +1 678 281 2027
David Collins or Chris Eddy
Catalyst World wide + 1 212-924-9800 or [email protected]
