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ADM Identifies and Corrects Accounting Practices

CHICAGO ÔÇö ADM announced that it has recently discovered and rectified certain intersegment sales that were not accurately recorded at market value. This discovery came as a result of an ongoing investigation into the company’s accounting practices.

The corrections were made in the intersegment sales between the Nutrition reporting segment and the Ag Services, Oilseeds, and Carbohydrate Solutions reporting segments. Despite these adjustments, ADM stated that there has been no impact on the company’s consolidated balance sheets and statements of earnings.

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ADM’s investigation spans from January 2018 to September 2023 and revealed that past operating profits for the Nutrition segment had to be lowered by tens of millions of dollars. Conversely, there was a slight increase in profits for the Ag Services, Oilseeds, and Carbohydrate Solutions segments according to the company’s filing with the US Securities and Exchange Commission (SEC).

During the investigation, ADM also identified a “material weakness” in its internal control over financial reporting specifically related to accounting practices and procedures for intersegment sales. In response, the company has developed a remediation plan to enhance the reliability of its financial statements in this area.

ADM’s chairman and chief executive officer, Juan Luciano, emphasized the company’s commitment to strong internal controls and delivering on their purpose of enriching the quality of life through nature. ADM is actively cooperating with the SEC and the Department of Justice regarding this matter.

In light of the investigation, ADM has placed its chief financial officer, Vikram Luthar, on administrative leave as part of their efforts to address the situation and ensure compliance with regulatory standards.

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