Lewisville, Texas-based Orthofix International reported final resolutions to Securities and Exchange Commission investigations regarding its previous accounting issues and anti-bribery matters in Brazil.
Here are six insights:
1. The investigated matters date back to between 2011 and 2013.
2. Orthofix voluntarily reported the accounting errors, launched an independent review and cooperated with the SEC. To avoid the problem in the future, Orthofix implemented structural initiatives and granular internal controls and process changes.
3. The second resolution involves an anti-bribery issue with Orthofix's Brazilian subsidiary. Orthofix self-reported the incident to the Department of Justice and SEC, conducted an internal review with outside help and cooperated with the agencies during investigation. In response to this matter, Orthofix fired some employees and ended relationships with some third-party distributorships. Read more about how Orthofix responded here.
4. The company noted the resolutions reflect the same material terms it previously disclosed.
5. Orthofix accrued all monetary payments made to the SEC in the second and third quarters of 2016, funded into escrow in the fourth quarter of 2016.
6. Orthofix President and CEO Brad Mason commented, "We have instituted broad remedial measures designed to detect and prevent the issues that led to the matters being resolved…" in regards to the resolutions.