Troubled Usana's auditor quits

Usana Health Sciences, a US-based multi-level marketing company with thousands of independent distributors in New Zealand, suffered another blow this week after it announced on Tuesday that its auditor had quit.

The next day, Usana’s share price fell about 17 per cent.

By Thursday it had recovered about half that loss and settled in the mid $US40 range.

In a filing to the US Securities and Exchange Commission (SEC), Usana said the company and its accounting firm, Grant Thornton LLP, “disagreed as to the scope of the procedures to be performed by the auditors.”

Usana has been plagued with problems this year, including investigations by the FBI and SEC, class action lawsuits filed against the company by its shareholders and distributors, and a couple of high-profile resignations by company spokesmen who were revealed to have been claiming false academic and medical credentials.

In a recent investigation, NBR explained how Usana representatives in New Zealand did not disclose any of the company’s problems to potential new recruits as they considered whether to invest their money in Usana distributorships.

Hundreds of Kiwis attend Usana recruitment meetings around the country each month.

Usana also gave its distributors and shareholders some good news this week, however, when it announced its second quarter results.

The company’s sales profits rose 9 per cent, beating analysts’ expectations.
Usana said that Grant Thornton had not disputed the company’s reported financial statements before it quit as the company’s auditor.

See also: www.nbr.co.nz/usana