UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): April 22, 2008
PROVIDENT
FINANCIAL HOLDINGS, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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000-28304
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33-0704889
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(State
or other jurisdiction
of
incorporation)
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(Commission
File
Number)
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(I.R.S.
Employer
Identification
No.)
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3756
Central Avenue, Riverside, California
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92506
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (951) 686-6060
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Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any
of the following provisions.
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[ ]
Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
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[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
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[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act
(17 CFR 240.14d-2(b))
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[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act
(17 CFR 240.13e-4(c))
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Item
4.02 Non-Reliance on Previously Issued Financial Statements or
Related Audit Report or Completed Interim Review.
In
February 2008, Provident Financial Holdings, Inc. (“Company”) identified a
potential discrepancy regarding the failure to release shares from its Employee
Stock Ownership Plan (“ESOP”) consistent with the repayment of the ESOP
loan. Subsequent investigation determined the amount of unallocated
shares remaining in the ESOP exceeds what is scheduled to be released based on
the remaining ESOP loan payments. This discrepancy prompted
management to complete a thorough review of the administration of the ESOP,
which confirmed that because of the application of dividend payments received on
unallocated ESOP shares to reduce the balance of the ESOP loan, additional
shares should have been released in the years ended December 31, 2002 through
2007. Releasing these additional shares will result in additional
compensation expense to the Company for those respective periods.
Management
advised the Board of Directors, the Audit Committee and the Company’s
independent registered public accounting firm, Deloitte & Touche LLP and
management continued working to resolve the issue. On April 22, 2008,
the Audit Committee concluded, based on recommendations from management, that
the Company’s unaudited interim consolidated financial statements for the
quarterly periods ended September 30, 2007 and 2006; the quarterly periods ended
December 31, 2007 and 2006; as well as its audited consolidated financial
statements for the fiscal years ended June 30, 2007, 2006 and 2005, will need to
be restated and should no longer be relied upon. In addition, the
Company’s prior earnings and press releases and similar communications should no
longer be relied upon to the extent they are related to these financial
statements.
The
Company will restate the consolidated financial statements noted above to
recognize additional compensation expense for the previously reported
periods. For the fiscal year ended June 30, 2003 additional
compensation expense of approximately $177,000 must be recognized; for the
fiscal year ended June 30, 2004 additional compensation expense of approximately
$519,000 must be recognized; for the fiscal year ended June 30, 2005 additional
compensation expense of approximately $893,000 must be recognized; for the
fiscal year ended June 30, 2006 additional compensation expense of approximately
$904,000 must be recognized; for the fiscal year ended June 30, 2007 additional
compensation expense of approximately $835,000 must be recognized; and for the
six months ended December 31, 2007 additional compensation expense of
approximately $271,000 must be recognized. The additional
compensation expense recognized is not tax deductible. The net effect
of these adjustments for each period will be to increase non-interest expense
and decrease net income by an equal amount. Management is still in
the process of analyzing the full impact of this restatement to the prior
periods and cannot accurately disclose the impact of the changes on the
consolidated statements of financial condition, consolidated statements of
operations, consolidated statements of stockholders’ equity, and consolidated
statements of cash flows for the applicable prior periods.
The
Company will file amendments to its Annual Report on Form 10-K for fiscal 2007,
and to its Forms 10-Q for the quarterly periods ended September 30, 2007 and
December 31, 2007. The Company’s Form 10-Q for the quarterly period
ended March 31, 2008 will reflect these prior
period
restatements. The Company anticipates that it will need additional
time to make the necessary adjustments to the March 31, 2008 Form 10-Q and will
likely file a Form 12b-25 to request a five day extension of the May 12, 2008
filing deadline for the Form 10-Q.
The
Company intends to file a voluntary self correction pursuant to Section 11 of
Revenue Procedures 2006-27 requesting that the Internal Revenue Service issue a
determination that the operational failure of the ESOP will be fully and
completely corrected, that the ESOP will remain tax-qualified, and that no
enforcement action will be taken with respect to its operational failures. No
assurances can be given with respect to the outcome of this voluntary self
correction.
The
restatement described in this Form 8-K is considered a material weakness for
purposes of the Company's internal control over financial reporting and
disclosure controls and procedures.
The
Company has cancelled its News Release announcing fiscal third quarter earnings
previously scheduled for distribution prior to the market open on Thursday,
April 24, 2008 and its Earnings Conference Call previously scheduled for Friday,
April 25, 2008 at 9:30 a.m. (Pacific Time Zone) as a result of the restatements
described in this Form 8-K. The Company will reschedule its third
quarter Earnings Conference Call soon after its filing of the March 31, 2008
Form 10-Q.
Forward-looking
statements in this Form 8-K are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. These forward-looking
statements include the statements regarding errors in previously issued
financial statements; the nature, magnitude and scope of these errors and the
Company's investigation and analysis of such errors. These statements are just
predictions reflecting management's current judgment and involve risks and
uncertainties, such that actual results may differ significantly. These risks
include, but are not limited to, additional actions resulting from the Company's
continuing internal review and implementation of improvements to internal
controls, as well as the review and audit by the Company's independent auditors
of restated financial statements, if any, actions resulting from discussions
with or required by the Securities and Exchange Commission, along with other
risks and uncertainties discussed in the Company's Annual Report on Form 10-K
for fiscal 2007 and the Company's Quarterly Reports on Form 10-Q for subsequent
quarters. In addition, any forward-looking statements represent our estimates
only as of today and should not be relied upon as representing our estimates as
of any subsequent date. The Company disclaims any obligation to update any
forward-looking statements.
Item
9.01 Financial Statements and Exhibits
(d) Exhibits
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99.1
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News
Release regarding the restatement dated April 23,
2008.
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SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the Registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
| PROVIDENT FINANCIAL HOLDINGS, INC. | |
| Date: April 23, 2008 | |
| /s/Craig G. Blunden | |
| Craig G. Blunden | |
| Chairman, President and Chief Executive Officer | |
| (Principal Executive Officer) | |
| /s/Donavon P. Ternes | |
| Donavon P. Ternes | |
| Chief Operating Officer and Chief Financial Officer | |
| (Principal Financial and Accounting Officer) |
EXHIBIT
99.1
 |
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3756
Central Ave. NEWS RELEASE
Riverside,
CA 92506
(951)
686-6060
Provident
Financial Holdings
To
Restate Prior Period Financial Statements
Riverside,
Calif. – April 23, 2008 – Provident Financial Holdings, Inc. (“Company”),
(Nasdaq GS: PROV), today announced that it will restate the Company’s unaudited
interim consolidated financial statements for the quarterly periods ended
September 30, 2007 and 2006; the quarterly periods ended December 31, 2007 and
2006; as well as its audited consolidated financial statements for the fiscal
years ended June 30, 2007, 2006 and 2005 and they should no longer be relied
upon.
The
restatements relate to the recognition of additional compensation expense for
the previously reported periods as a result of a correction to the
administration and operation of the Company’s Employee Stock Ownership Plan
(“ESOP”). The cumulative total of the additional compensation expense
to be recognized in prior periods is approximately $3.6 million and is not tax
deductible. Management is still in the process of analyzing the full
impact of the operational error of the ESOP and can give no assurance that
further analysis will not reveal additional errors, which may impact the
Company’s previously issued financial statements and earnings
releases. Additionally, management cannot accurately disclose at the
present time the impact of the changes on the consolidated statements of
financial condition, consolidated statements of operations, consolidated
statements of stockholders’ equity and the consolidated statements of cash flows
for the applicable prior periods.
The
Company will file amendments to its Annual Report on Form 10-K for fiscal 2007
and to its Forms 10-Q for the quarterly periods ended September 30, 2007 and
December 31, 2007. The Company’s Form 10-Q for the quarterly period
ended March 31, 2008 will reflect these prior period
restatements. The Company anticipates that it will need additional
time to make the necessary adjustments to the March 31, 2008 Form 10-Q and will
likely file a Form 12b-25 to request a five day extension of the May 12, 2008
filing deadline for the Form 10-Q.
The
Company has cancelled its News Release announcing fiscal third quarter earnings
previously scheduled for distribution prior to the market open on Thursday,
April 24, 2008 and its Earnings Conference Call previously scheduled for Friday,
April 25, 2008 at 9:30 a.m. (Pacific Time Zone) as a result of the restatements
described herein. The Company will reschedule its third quarter
Earnings Conference Call soon after its filing of the March 31, 2008 Form
10-Q.
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Safe-Harbor Statement
Forward-looking
statements in this News Release are made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include the statements regarding errors in previously
issued financial statements; the nature, magnitude and scope of these errors and
the Company’s investigation and analysis of such errors. These
statements are just predictions reflecting management’s current judgment and
involve risks and uncertainties, such that actual results may differ
significantly. These risks include, but are not limited to,
additional actions resulting from the Company’s continuing internal review and
implementation of improvements to internal controls, as well as the review and
audit by the Company’s independent auditors of restated financial statements, if
any, action resulting from discussions with or required by the Securities and
Exchange Commission, along with other risks and uncertainties discussed in the
Company’s Annual Report on Form 10-K for fiscal 2007 and the Company’s Quarterly
Reports on Form 10-Q for subsequent quarters. In addition, any
forward-looking statements represent our estimates only as of today and should
not be relied upon as representing our estimates as of any subsequent
date. The Company disclaims any obligation to update any
forward-looking statements.
| Contacts: | Craig G. Blunden | Donavon P. Ternes |
| Chairman, President and CEO | Chief Operating Officer and | |
| Chief Financial Officer |