Military shipbuilder Austal says investigation settlement in best interest of company

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Executives with military shipbuilder Austal say settling an accounting fraud investigation is the best outcome for the company and that new financial controls have been put in place.

FILE - The Littoral Combat Ship Coronado sits alongside the Austal USA facilities on the Mobile River in Mobile, Ala., following christening ceremonies for the ship, Jan. 14, 2012. MOBILE, Ala. — Executives with military shipbuilder Austal said settling an accounting fraud investigation, which included an agreement to pay a $24 million penalty, is the best outcome for the company and that new controls are in place.

Restitution will also be paid to Austal shareholders. However, the restitution will be paid from the penalty, so the company will pay a total of $24 million. The Justice Department said that from 2013 through July 2016, Austal USA misled shareholders and investors about the company’s financial condition. The Justice Department said Austal USA artificially lowered cost estimates, despite rising shipbuilding costs, to meet its revenue budget and projections. That had the impact of falsely overstating Austal USA’s profitability on the ships and Austal Limited’s earnings reported in its public financial statements.

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Military shipbuilder Austal says investigation settlement in best interest of companyExecutives with military shipbuilder Austal say settling an accounting fraud investigation is the best outcome for the company and that new financial controls have been put in place.
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