Verifone’s CFO Resigns after Internal Audit

Verifone is in the business of securing electronic payment transactions. So when it discovered it was having trouble securing its own transactions, leadership accountability came into question.

According to Financial Week, Verifone, the electronic payment company, has completed their in-house investigation of accounting systems, resulting in Barry Zwarenstein’s resignation. In an issued statement, the company stated that as a result of their investigation, Verifone “did not maintain effective internal control over financial reporting.” Errors for how in-transit inventory was reported were specifically noted.

Verifone’s in-transit shipments were not automatically accounted for in the company’s accounting system, which resulted in double-counting of some inventory. This chain of events has led Verifone to reveal that their actual operating income will decrease by approximately $37 million.

CEO Douglas Bergeron will also resign as chairman as such a situation warrants new management. Zwarenstein is expected to stay with Verifone until their restatements are completed and the company files its fourth quarter and annual reports later this year. The new search for a CFO is ongoing.