HealthSouth will file annual report late

/ Source: The Associated Press

HealthSouth Corp., which is under investigation for its accounting practices, will miss the deadline to file its annual report, according to a regulatory filing Tuesday.

The Birmingham, Ala.-based operator of rehabilitation, surgery and other health-care centers expects to file its 2003 report in the first quarter of 2005, according to the filing with the Securities and Exchange Commission.

The SEC and the Department of Justice are investigating HealthSouth’s financial reporting, including the accuracy of the company’s previously filed financial statements.

HealthSouth has said its previous financial statements are no longer reliable and has hired the accounting firm PricewaterhouseCoopers LLP to review prior statements.

In January, HealthSouth said the review is substantially complete and its special audit review committee is preparing a report on the forensic review.

HealthSouth said it is unable to determine the extent of any change in its results of operations while it completes its 2003 financial statements.

HealthSouth founder Richard M. Scrushy was ousted in 2003 as the company’s chairman and chief executive after a fraud investigation became public.

Scrushy, who faces 85 criminal counts for his alleged role in the accounting fraud, is scheduled to go to trial in August.

Fifteen of Scrushy’s former top finance and accounting executives have pleaded guilty in the scandal, in which assets and earnings allegedly were inflated over a number of years in an effort to meet analysts’ expectations.

Scrushy’s lawyers say he didn’t know about the estimated $3 billion fraud at the health-care company. The initial federal raid of HealthSouth occurred in March 2003.