"As a result, Big 5's management and its audit committee have recommended, and its board of directors has approved, the review and restatement of its financial statements for fiscal 2001, 2002 and 2003," the company said in a statement. "The expected impact on net income is $1.2 million for 2001, $2.1 million for 2002 and $1.4 million for 2003. The adjustments reflected in the attached preliminary financial statements are being reviewed by the company and its independent registered public accounting firm (KPMG) and could change."

The "impact" the company refers to are overstatements of net income for the years in question, as well as a $500,000 overstatement for 2000. During Wednesday's earnings call, Big 5 president, CEO and chairman Steven G. Miller asserted that the restatement "had no impact on our sales, including same-store sales, or cash flows, and in no way will impact our business going forward."

Miller also offered an account of the company's decision to restate its income. "During our normal year-end accounting review, we discovered an error in our accounts payable, as reported in our financial statements," he said. "The error occurred when commercial invoices related to letters of credit were not reconciled in a timely basis." These unmatched credits were then erroneously included as income in each year.