Integrated Electrical, CFO, former executives may face SEC action over accounting

By Caroline Salls

Pittsburgh, April 24 - Integrated Electrical Services, Inc., its chief financial officer and some former company executives received Wells Notices indicating the intent of the staff of the Securities and Exchange Commission to recommend an enforcement action be brought against the recipients for possible violations of federal securities laws, according to an 8-K filing with the SEC.

The notices concern the accounting treatment and disclosure of two receivables that were written down in 2004, the company's contingent liabilities disclosures in various prior periods and its failure to disclose a change in its policy for bad debt reserves and resulting reserve write-down that occurred in 2003 and 2004, Integrated Electrical said in the 8-K.

These actions could violate the books and records, internal controls and antifraud provisions of the Securities Exchange Act of 1934, the company said.

The filing said recipients of the notices have the opportunity to submit a statement setting forth their interests and position in connection with any proposed enforcement action.

Integrated Electrical Services, a Houston-based provider of electrical services to the commercial, industrial and residential markets, filed for bankruptcy on Feb. 14 in the U.S. Bankruptcy Court for the Northern District of Texas. Its Chapter 11 case number is 06-30602.

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