Flexiroam Limited (ASX: FRX) Announces Correction of FY2024 Financial Statements
Correction of Financial Statements
Flexiroam Limited (ASX: FRX) has announced a correction to its FY2024 financial statements following an accounting error. The misstatement was identified during management’s review of monthly revenue performance, prompting a reassessment of revenue recognition for transactions relating to a billing mistake under previous management.
The revenue for the financial year ended 30 June 2024 has been restated to reflect accurate figures. The initially reported revenue of AUD 15,273,087 now decreases to AUD 14,851,962, resulting in a larger loss after tax of AUD 1,481,802 compared to the previous AUD 1,060,677.
Details of the Accounting Error
The finance team concluded that a significant reduction in revenue occurred due to a deferred credit applied to an invoice issued during the first half of FY2024. This credit, which should have been recorded in the FY2024 financial statements, was incorrectly deferred.
The correction resulted in a net reduction of AUD 421,125 in recorded revenue, thus increasing the net loss after tax for the year. The error originated from two invoices issued based on inaccurate information by the former management team.
Executive Comments
Steve Picton, CEO and Executive Chairman of Flexiroam Limited, stated, “We take this accounting error extremely seriously. Under the new management team, we have changed our revenue recognition assessment process for better accuracy.”
The updated financial position significantly affects the current assets, equity, and accumulated losses reported for the period. Flexiroam Limited has prioritised transparency and accuracy in its financial reporting and is committed to rectifying the oversight.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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