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LI holding company says its financial statements 'contained errors'

Janel Corp. of Lynbrook disclosed in an SEC

Janel Corp. of Lynbrook disclosed in an SEC filing that its financial statements "should no longer be relied upon."  Credit: Danielle Silverman

A publicly traded Long Island holding company said its financial statements from fiscal 2016, 2017 and most of 2018 "should no longer be relied upon."

In a government filing late Wednesday, Lynbrook-based Janel Corp. said the board of directors concluded on Jan. 24 that some previously issued financial statements "contained errors" related to revenue recognition.

The report said the board has not determined how much revenue is affected in its ongoing review.

Members of the board and company executives have held talks with Janel's current and previous public accounting firms, the filing said.

Janel's subsidiaries include a logistics services company and a provider of commercial mixers, shakers and stirrers.

Newsday listed Janel as Long Island's 29th largest public company based on its reported fiscal 2017 revenue of $77.8 million. 

Dominique Schulte, a lawyer and investment company executive, was named CEO and president on Oct. 1.

She did not respond to calls seeking comment.

The financial statements believed to have errors cover the 2016 and 2017 fiscal years ending on Sept. 30 and the quarters ended Dec. 31, 2017, March 31, 2018, and June 30, 2018.

In a filing with the Securities and Exchange Commission on Jan. 2, the company said it would be unable to file its annual report for the fiscal year ended Sept. 30 on time because of accounting issues in its logistics business.

In another filing on April 30, 2018, Janel had acknowledged "existing material weaknesses related to lack of qualified accounting personnel and lack of appropriate review and oversight."

Schulte also is a managing member of Manhattan-based Oaxaca Group LLC, which held 78.8 percent of Janel's stock as of Thursday, according to filings compiled by Bloomberg.

She joined Janel's board of directors in November 2015 and became chair in May.

Janel had 129 full-time and five part-time employees as of June 30, 2018, the company said in a filing.

Shares of Janel rose 0.6 percent Thursday to close at $8.36. Twelve months ago the stock was trading at $9.80. 

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