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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q/A
(AMENDMENT NO. 1)
(Mark One)
| þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2004 |
OR
| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD |
FROM TO
COMMISSION FILE NUMBER 000-26124
IXYS CORPORATION
(Exact name of registrant as specified in its charter)
| DELAWARE | 77-0140882 | |
| (State or other jurisdiction | (IRS Employer Identification No.) | |
| of incorporation or organization) |
3540 BASSETT STREET
SANTA CLARA, CALIFORNIA 95054-2704
(Address of principal executive offices and Zip Code)
SANTA CLARA, CALIFORNIA 95054-2704
(Address of principal executive offices and Zip Code)
(408) 982-0700
(Registrant’s telephone number, including area code)
(Registrant’s telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yesþ Noo
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
Yesþ Noo
THE NUMBER OF SHARES OF THE REGISTRANT’S COMMON STOCK, $0.01 PAR VALUE, OUTSTANDING AS OF, JULY 18, 2005 WAS 33,542,122.
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EXPLANATORY NOTE
THIS FORM 10-Q/A IS BEING FILED FOR THE PURPOSE OF AMENDING AND RESTATING ITEM 4 OF PART I OF FORM 10-Q. ALL INFORMATION IN THE FORM 10-Q/A, OTHER THAN ITEM 4, IS AS OF SEPTEMBER 30, 2004 AND DOES NOT REFLECT ANY SUBSEQUENT INFORMATION OR EVENTS.
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PART I — FINANCIAL INFORMATION
ITEM 4. CONTROLS AND PROCEDURES
An evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, or Exchange Act) as of September 30, 2004. This evaluation included various processes that were carried out in an effort to ensure that information required to be disclosed in our Securities and Exchange Commission, or SEC, reports is recorded, processed, summarized and reported within the time periods specified by the SEC. In this evaluation, the Chief Executive Officer and the Chief Financial Officer considered whether our disclosure controls and procedures were also effective to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. This evaluation also included consideration of certain aspects of our internal controls and procedures for the preparation of our financial statements. Our Chief Executive Officer and Chief Financial Officer concluded that, as of September 30, 2004, our disclosure controls and procedures were not effective.
In evaluating our internal controls, we sought to determine whether there were any “control deficiencies,” “significant deficiencies” and, in particular, whether there were any “material weaknesses.” “Control deficiencies” exist when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. “Significant deficiencies” and “material weaknesses” are internal control deficiencies that adversely affect a company’s ability to initiate, authorize, record, process or report information in its external financial statements in accordance with generally accepted accounting principles. A “significant deficiency” is defined as a single deficiency, or a combination of deficiencies, that results in more than a remote likelihood that a misstatement of the financial statements that is more than inconsequential in amount will not be prevented or detected. A “material weakness” is defined as a significant deficiency that, by itself, or in combination with other significant deficiencies, results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected.
At March 31, 2004, we had a material weakness. Certain of our inventory processes were not reviewed by a supervisor in sufficient detail, resulting in the following inaccurate adjustments: standard cost revisions; incomplete updating of costs included in the standards; journal entries recorded without the proper supporting documentation; and reconciliation of the general ledger balance to the perpetual records. A lack of procedures to track inventory transactions related to cut-off issues was also found. The material weakness constituted a deficiency in our disclosure controls and procedures.
The material weakness related to errors in our Santa Clara, California operation, which occurred in connection with a systematic update of standard costs following a review of standard costs. We review standard costs on an as-needed basis, but no less frequently than annually. One review of standard costs occurred in fiscal 2004, during our fourth quarter. Because the errors giving rise to the material weakness occurred in connection with a systematic update of standard costs that occurred only in the fourth quarter, the material weakness related to the fourth quarter of fiscal 2004 and not to prior periods.
The net effect of the corrections of these errors on our financial statements for the year ended March 31, 2004 was a reduction in cost of goods sold on our statement of operations of $823,000, an increase in inventory of $1,099,000 and an increase in accrued expenses and other liabilities of $276,000.
We have implemented controls and procedures in our Santa Clara operations to address the material weakness. These controls and procedures include supervisory review of standard costs and improved cycle count procedures. In addition, we added two cost accountants at our Santa Clara location.
We have documented our procedures for updating standard costs and established procedures for cost methodologies. We are currently implementing manufacturing resource planning software in Santa Clara that, among other things, will monitor standard costs and inventory movement. We assessed the operation of our controls and procedures relating to the updating of standard costs in our Santa Clara operation and determined that they operated effectively. We believe the material weakness that existed as of March 31, 2004 has been remediated. In the future, we also intend to schedule standard cost revisions for times other than when financial statement closings are occurring.
As mitigation, we performed a regular review of the actual costs of significant inventory components, in which we compared actual costs to standard costs to ascertain that our standard costs approximate actual costs. We also reviewed aggregate variances each quarter for an indication of the appropriateness of standard costs.
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PART II—OTHER INFORMATION
ITEM 6. EXHIBITS
See the Index to Exhibits, which is incorporated by reference herein.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| IXYS CORPORATION | ||
| By: /s/ Uzi Sasson | ||
| Uzi Sasson, Vice President of Finance and Chief Financial Officer (Principal Financial Officer) |
Date: July 29, 2005
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EXHIBIT INDEX
| Exhibit | ||
| No. | Description | |
| 3.1 | Amended and Restated Certificate of Incorporation of the Registrant. (1) | |
| 3.2 | Amended and Restated Bylaws of the Registrant. (2) | |
| 10.1 | Stock Option Agreement of Kenneth D. Wong.* | |
| 10.2 | Form of stock option agreement for non-employee directors.* | |
| 10.3 | Form of stock option agreement for employees, including executive officers.* | |
| 31.1 | Certificate of Chief Executive Officer required under Section 302 of the Sarbanes-Oxley Act of 2002. * | |
| 31.2 | Certificate of Chief Financial Officer required under Section 302 of the Sarbanes-Oxley Act of 2002. * | |
| 31.3 | Certificate of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.4 | Certificate of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1 | Certification required under Section 906 of the Sarbanes-Oxley Act of 2002. (3)* |
| * | Previously filed with the Quarterly Report on Form 10-Q for the period ended September 30, 2004 (000-26124). | |
| (1) | Filed as Exhibit 3.1 to the Annual Report on Form 10-K for the fiscal year ended March 31, 2001 (000-26124) and incorporated by reference herein. | |
| (2) | Filed as Exhibit 3.2 to the Quarterly Report on Form 10-Q for the period ended September 30, 2002 (000-26124) and incorporated by reference herein. | |
| (3) | This exhibit is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1933, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities and Exchange Act of 1993, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. |
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