NEW YORK CITY—American Realty Capital Properties has replaced its CFO and chief accounting officer after an audit committee determined that the net lease REIT's adjusted funds from operations had been overstated for the first and second quarters, while net losses were understated. The audit committee, ARCP said, determined that the accounting errors were “identified but intentionally not corrected” and that previously issued financial information from those quarters should no longer be relied upon.
Brian Block has resigned as CFO and has been replaced by Michael Sodo, who most recently was SVP, director of financial reporting and treasurer. Gavin Brandon has been promoted to chief accounting officer, replacing Lisa McAlister.
“The accounting issues are unacceptable and we are taking the personnel and other actions necessary to ensure that this does not happen again,” says CEO David S. Kay. “As disappointed as I am, I do not believe that this impairs, in any meaningful way, what is important about our company—the high quality and diversification of our real estate assets, the depth and strength of our management team, the strong and predictable cash flows from our leases, the strength of our balance sheet and the size of our market opportunity.”
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