Litigation

Trouble keeping the books at TheStreet.com?

By Tracy Coenen

It’s interesting to note that TheStreet.com (NASDAQ:TSCM) is apparently having trouble keeping its books, especially since Jim Cramer is one who loves to rant about companies with shoddy bookkeeping. It’s troubling, of course, because Cramer suggests that you should sell the stocks of companies that don’t keep up with their regulatory filings, and TheStreet.com is now delinquent on filing its 10-Qc for 6/30/09 and 9/30/09.

From their recent press release:

The Company previously announced that it had identified an issue relating to its recording of certain revenue in a non-core business, Promotions.com, that the Company acquired in August 2007. Since that announcement, the Company has been conducting a thorough review of accounting matters related to the business unit and the Company currently is assessing the impact of such matters on the periods since the acquisition. The Company has not yet determined whether it will be required to restate any prior period results. The Company currently does not believe that this matter is likely to result in any significant percentage revision to the aggregate revenue or expenses previously reported by the Company since the acquisition (although the Company cannot give any assurances with respect to this matter as its review is not yet complete), but may result in material revisions, upward or downward, to the net income reported by the Company during any one or more of the periods since the acquisition. This matter does not affect the Company?s previously reported cash, cash equivalents, restricted cash or marketable securities. The Company is endeavoring to complete its review of this matter expeditiously, but cannot presently give assurances as to when the review will be completed.

When the review is completed, the Company will announce a new date and time for its second-and third-quarter 2009 earnings release and investor conference call in a subsequent press release.

Even more troubling is that this bookkeeping mess follows some other disturbing developments at TheStreet.com, which include board members and executives jumping ship at record pace.

The guys over at WallStreetCheatSheet took a couple of well-deserved shots at Cramer… noting that if one follows Cramer’s own advice, they’ll sell the stock. Cramer was none too happy with their blog posting, but who can really blame them for simply pointing out the obvious?

Full post as published by The FRAUDfiles Blog on November 20, 2009 (boomark / email).