Youbet.com to restate 1Q, 2Q financial results

Youbet.com to restate results for 1st and 2nd quarters, names Susan Bracey interim CFO

• On 12:47 pm EDT, Tuesday September 8, 2009

BURBANK, Calif. (AP) -- Online horse racing and betting company Youbet.com Inc. said Tuesday that it will restate its financial reports for the first and second quarters to fix an accounting error.

Youbet said the problem stems from an incorrect calculation of accruals through the company's "Youbet Advantage" player incentive program. Program points were not automatically canceled along with the program's terms, Youbet said, and members were able to redeem expired points for credit against future wagers or merchandise.

The company expects the restatement will result in a non-cash charge of $346,000 that lowers its already reported first-quarter income by a penny per share.

Youbet said it uncovered the problem when reviewing the program to make it more efficient.

Youbet added that it will revise its estimates of the par values of player rewards points it issued through the program. Because of this, it anticipates logging a non-cash charge of $550,000 in the third quarter.

Also Tuesday, Youbet said it named Susan Bracey as its interim chief financial officer.

Bracey is taking the post effective immediately. The job had been left open after Jim Burk left Youbet at the end of March.

Bracey's previous position was as CFO for ticket seller Ticketmaster Entertainment Inc.

Youbet shares fell 11 cents, or 4.9 percent, to $2.14 in afternoon trading.

Buzz up!