Skechers USA has hired BDO USA as its auditor after KPMG resigned and withdrew two annual audit opinions because the engagement partner was facing allegations of insider trading.

The company said it will file its Form 10-Q for the first quarter of 2013 on time on May 10, or no later than May 15 with required notice provided to the Securities and Exchange Commission. The company did not say whether BDO USA would provide a review of its first-quarter filing or the company would file the 10-Q unreviewed. Skechers said BDO would start immediately on the re-audit of the company's 2011 and 2012 financial statements. The company says it selected BDO after an “extensive evaluation process” by its audit committee.

KPMG resigned and withdrew five years worth of audit reports from Skechers and Herbalife after it learned its engagement partner on those audits, Scott London, was under investigation for insider trading.  London was also the head of KPMG's audit business in Los Angeles before he was fired as the allegations came to light.

“Skechers' focus during this transition period has been on finding new auditors, preparing to report our first quarter 2013 earnings, and managing our global footwear business,” began David Weinberg, Skechers Chief Operating Officer and Chief Financial Officer. “With BDO now in place, we believe that they will efficiently audit the last two fiscal years of our consolidated financial statements and expertly handle our future audit needs.”

The Department of Justice and the Securities and Exchange Commission are both pursuing insider trading charges against London and his friend and golf partner. They say London shared confidential information regarding a total of five KPMG clients in exchange for cash, jewelry and entertainment valued at $55,000.

Topics