PATRIOT NATIONAL BANCORP INC (PNBK): auditor change — Patriot National Bancorp restates Q1/Q2 2023 due to CECL error; equity impact ~$5.3M

PATRIOT NATIONAL BANCORP INC

Audit committee concluded no reliance on Q1 and Q2 2023 10-Qs; restatements to be filed.
CECL transition adjustment error from unsupported data on purchased unsecured consumer loan portfolio.
Preliminary impact: $5.3M net of tax reduction to shareholders' equity; net loss increases Q1 +$650k, Q2 +$70k.
Company negotiating with third-party originator/servicer to recover losses.
Error due to understated weighted average life, incorrect loss rate, and inadequate delinquency adjustment.

item 4.02

Key facts

Extracted from this filing and checked against the source text.

Auditor Changes SEC 8-K Item 4.01/4.02 confidence 0.9

PATRIOT NATIONAL BANCORP INC reported that prior financial statements should not be relied upon.

Action: non reliance

Exact text from the filing

As a result of the self-identified error, the Audit Committee determined that the unaudited financial statements included in the 2023 Q1 10-Q and 2023 Q2 10-Q should no longer be relied upon. Similarly, any previously furnished or filed reports, related earnings releases, investor presentations or similar communications of the Company describing those financial statements and other information covering the Affected Periods should no longer be relied upon. The Company plans to restate, as soon as practicable, the financial statements for the Affected Periods in amendments to the 2023 Q1 10-Q and the 2023 Q2 10-Q, respectively. The error in the Company’s calculations of the CECL transition adjustment was due to the use of unsupported and incorrect data points used in conjunction with data provided by the third-party originator/servicer. The Company identified the following problems with it

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19 auditor changes filed in the last 30 days. Browse all auditor changes →

PATRIOT NATIONAL BANCORP INC filing history →

Source: SEC EDGAR

accession 0001628280-23-035514

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