Beazer Postpones SEC Filing,
Citing Accounting Woes

Troubles continue to mount for Atlanta-based Beazer Homes USA Inc. The home builder said late Friday that it was delaying the filing of its most recent quarterly report with the Securities and Exchange Commission because of possible problems with how its former chief accounting officer recorded "reserves and other accrued liabilities" related to land-development and home-building costs.

Beazer said in an SEC filing that its former accounting chief, Michael Rand, may have recorded such liabilities in "excess of amounts that would have been appropriate under generally accepted accounting principles." These "reserves and other accrued liabilities, if reversed in subsequent accounting periods, could have been used to reduce the Company's operating expenses," the company said in the filing. (Read the SEC filing.)

Beazer said it hasn't been able to determine whether the release of some of these reserves will affect its financial results for its most recent quarter ended June 30 so it has delayed its quarterly filing.

The accounting problems were brought to light during the course of an internal investigation into the company's mortgage operations. Beazer also faces a probe by the Federal Bureau of Investigation into its lending practices, after several home owners in North Carolina said they were given loans that they couldn't afford, leading to widespread foreclosures.

In late June, the company said that it fired Mr. Rand for attempting to destroy company documents. The company doesn't believe the amount of money involved in the accounting problems "during the quarterly and nine month periods ended June 30, 2006 and 2007 are quantitatively material." Mr. Rand couldn't be reached for comment.

Beazer added it "does not believe that the resolution of these issues will result in an adjustment to the Company's previously reported cash position," but wasn't sure whether it would have to restate prior financial results.

In recent weeks, the company has had its credit line cut in half, and has been beset by rumors that it was going to file for bankruptcy protection, sending its stock plummeting.

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