CreditRiskMonitor expects $1.77 million sales tax liability, restates financials after nexus study

• CreditRiskMonitor flagged state and local tax nexus exposure, prompting its audit committee to withdraw reliance on prior financial statements.
• Review indicated uncollected sales and use taxes in jurisdictions where it had economic or physical nexus.
• Preliminary estimate: sales tax liability of about 1.77 million, including interest; income tax liability of about 210,000, including interest.
• Plans to restate results for affected periods; expects the main impact in accrued liabilities, retained earnings, SG&A, interest, income tax expense.
• Identified a material weakness in controls over identifying and monitoring state and local tax nexus requirements; remediation plan underway.

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