CHICAGO โ ADM said it has identified and corrected certain intersegment sales that were not recorded at amounts approximating market value as part of an ongoing investigation of its accounting practices.
The company said it made the corrections in certain intersegment sales that occurred between the Nutrition reporting segment and the Ag Services and Oilseeds and Carbohydrate Solutions reporting segments.
The adjustments have no impact on the companyโs consolidated balance sheets and statements of earnings because intersegment sales occur between the reporting segments, the company said. ADMโs investigation covered the period from January 2018 to September 2023.
ADM lowered past operating profits for its Nutrition segment by tens of millions of dollars while slightly increasing profits for its Ag Services and Oilseeds and Carbohydrate Solutions segments, according to its filing with the US Securities and Exchange Commission (SEC).
As part of its international investigation, ADM said it identified a โmaterial weaknessโ in its internal control over financial reporting related to its accounting practices and procedures for intersegment sales.
โLooking ahead, we have developed a remediation plan with respect to the identified material weakness to enhance the reliability of our financial statements with respect to the pricing and reporting of such sales,โ said Juan Luciano, chairman and chief executive officer of ADM. โWe remain committed to strong internal controls. We look to continue our focus on execution and remain steadfast in delivering on our purpose of unlocking the power of nature to enrich the quality of life.โ
ADM said it continues to cooperate with the SEC and the Department of Justice in this matter.
In late January, ADM placed Vikram Luthar, its chief financial officer, under administrative leave in connection with the investigation.
