Winchester disk drive maker MiniScribe Corp’s new chief executive Richard Rifenburgh has uncovered a can of worms at the Longmont, Colorado company, and says that its financial statements for the first three quarters of 1988 and for fiscal years 1987 and 1986 are unreliable. And because the accounting controls then in effect, and surviving records and documentation may not make it possible for the company accurately to quantify and correct overstatements of assets for the those periods, it is likely that MiniScribe will be unable to produce reliable financial statements for those periods. Given these circumstances, and pending class action litigation, it is doubtful that the company’s present auditors, Coopers & Lybrand, will be able to express an unqualifed opinion with respect to restated financial statements for 1988 and prior years. That in turn means that the inability to prepare periodic reports that comply fully with federal securities laws, and to deliver those reports to the trustee for the company’s debentures may after notice, become an event of default. It does continue to make timely interest payments, the most recent having been made on May 15, 1989.
