The notice refers to sales recorded between the third quarter of 2015 and the fourth quarter of 2016. The company used an “advance,” which is when it recorded a “customer sale that was executed earlier than originally planned,” according to the presentation . This is generally done to meet sales targets and is not in itself a violation of SEC rules.
Under Armor clarified in the filing that the notification is “neither a formal charge of wrongdoing nor a final determination that the recipient has violated any law” and the SEC has found no accounting violations of this or any other period.
“The company and executives maintain that their actions were appropriate and intend to follow the Wells Notice process, which will include an opportunity to respond to the position of SEC staff, and also look forward to engaging in dialogue with staff from the SEC to work towards a resolution of this matter, “the company said.
Shares fell as much as 3% on Monday before going flat.
Update: This story has been updated to clarify how a trailer works.
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