Profits turn into loss for Huntingdon
Differences in accounting standards have turned profit into loss for Huntington Life Sciences.
In its results published yesterday the biotechnology company reported operating profits after taxation of pounds 200,000 for its third quarter ending September 30, 2001 under US GAAP.
However, under UK GAAP the profit has turned into an operating loss of Pounds 100,000.
Julian Griffiths, the company’s director of finance explained the differences in the way pensions, deferred tax, and the treatment of foreign exchange gains were responsible for the variance.
The main differences for Huntington are the treatment of deferred tax and accounting for pensions, which, under the current UK standard, SSAP 24, is calculated differently to that of the US. ‘The P&L charge works out differently,’ said Griffiths.
He expects the differences to be lessened when FRS17 is fully in place.
He told Accountancy Age: ‘I’m a not great advocate of having different accounting standards in several countries. Harmonisation from our perspective would be welcomed.’
The company is expected to shift its main listing from London to New York’s Nasdaq when it receives regulatory approval.
Links
UK plc success impossible to compare