Annual report pursuant to Section 13 and 15(d)

Restatement and Other Corrections of Previously Issued Consolidated Financial Statements (Tables)

v3.23.3
Restatement and Other Corrections of Previously Issued Consolidated Financial Statements (Tables)
 12 Months Ended
Jan. 29, 2023
Accounting Changes and Error Corrections [Abstract]  
Schedule of Error Corrections and Prior Period Adjustments
A summary of the impacts of the adjustments on the previously reported financial statements are included below. Note 13. Quarterly Financial Data (Unaudited) discloses the impact of the adjustments on the Company’s unaudited condensed financial information for each interim period within the fiscal year ended January 29, 2023.

Year Ended
January 29, 2023 January 30, 2022
(in thousands) As Previously Reported As Restated As Previously Reported As Revised
Net sales $ 651,545  $ 651,179  $ 498,239  $ 498,239 
Gross profit 345,826  343,651  273,345  273,532 
Operating income 39,017  36,966  38,441  40,578 
Net income 28,242  26,488  45,900  47,488 

As of
January 29, 2023 January 30, 2022
(in thousands) As Previously Reported As Restated As Previously Reported As Revised
Total current assets $ 194,041  $ 187,715  $ 225,158  $ 221,731 
Total non-current assets 224,013  220,911  146,421  147,353 
Total assets 418,054  408,626  371,579  369,084 
Total current liabilities 88,839  82,041  118,779  114,696 
Total non-current liabilities 135,955  133,491  96,574  96,574 
Total liabilities 224,794  215,532  215,353  211,270 
Total equity 193,260  193,094  156,226  157,814 
BALANCE SHEET

January 29, 2023
(amounts in thousands, except share and per share amounts) As Previously Reported Corrections Reference As Restated
Assets
Current Assets
Trade accounts receivable 9,469  (366)
(c)
 9,103 
Merchandise inventories, net 119,962  (335)
(g)
 119,627 
Prepaid expenses and other current assets 21,077  (5,625)
(a)(b)(e)(f)
 15,452 
Total Current Assets 194,041  (6,326) 187,715 
Operating lease right-of-use assets 138,271  (2,860)
(b)
 135,411 
Other Assets
Deferred tax asset 9,420  (743)
(f)
 8,677 
Other assets 21,863  501 
(e)
 22,364 
Total Other Assets 32,838  (242) 32,596 
Total Assets $ 418,054  $ (9,428) $ 408,626 
Liabilities and Stockholders' Equity
Current Liabilities
Accrued expenses 23,392  2,025 
(a)(b)(f)
 25,417 
Current operating lease liabilities 21,898  (8,823)
(b)(e)
 13,075 
Total Current Liabilities 88,839  (6,798) 82,041 
Operating Lease Liability, long-term 135,955  (2,464)
(b)
 133,491 
Total Liabilities 224,794  (9,262) 215,532 
Stockholders’ Equity
Accumulated earnings (deficit)
 10,706  (166)
(a)(b)(c)(f)(g)
 10,540 
Stockholders' Equity 193,260  (166) 193,094 
Total Liabilities and Stockholders' Equity $ 418,054  $ (9,428) $ 408,626 
The description of each error is described above. The impact of each error for the corresponding period in the above table is described below:
(a) Last Mile Freight - The correction of these misstatements resulted in an increase to prepaid expenses and other current assets of $1.0 million, an increase to accrued expenses of $2.3 million, and a decrease to accumulated earnings of $1.3 million at January 29, 2023.
(b) Leases - The correction of these misstatements resulted in an increase to prepaid expenses and other current assets of less than $0.1 million, a decrease to operating lease right-of-use assets of $2.9 million, an increase to accrued expenses of $0.2 million, a decrease to current operating lease liabilities of $2.7 million, a decrease to operating lease liability, long-term of $2.5 million, and an increase to accumulated earnings of $2.1 million at January 29, 2023.
(c) Buyer’s Remorse - The correction of these misstatements resulted in a decrease to trade accounts receivable of $0.4 million and a decrease to accumulated earnings of $0.4 million at January 29, 2023.
(e) Balance Sheet Reclassifications - The correction of these misstatements resulted in a decrease to prepaid expenses and other current assets of $6.7 million, a decrease to current operating lease liabilities of $6.2 million, and an increase to other assets of $0.5 million at January 29, 2023.
(f) Income Taxes - The tax impact of all misstatements resulted in a decrease to prepaid expenses and other current assets of less than $0.1 million, a decrease to deferred tax asset of $0.7 million, a decrease to accrued expenses of $0.5 million, and a decrease to accumulated earnings of $0.2 million at January 29, 2023.
(g) Inventory and Cost of Goods Sold - The correction of these misstatements resulted in a decrease to merchandise inventories, net of $0.3 million and a decrease to accumulated earnings of $0.3 million at January 29, 2023.
THE LOVESAC COMPANY
STATEMENT OF OPERATIONS

For the Year Ended January 29, 2023
(amounts in thousands, except per share data and share amounts) As Previously Reported Corrections Reference As Restated
Net sales $ 651,545  $ (366)
(c)
 $ 651,179 
Cost of merchandise sold 305,719  1,809  (a)(g) 307,528 
Gross profit 345,826  (2,175) 343,651 
Operating expenses
Selling, general and administration expenses 216,103  (124)
(b)
 215,979 
Total operating expenses 306,809  (124) 306,685 
Operating income (loss) 39,017  (2,051) 36,966 
Net income (loss) before taxes 38,900  (2,051) 36,849 
(Provision for) benefit from income taxes
 (10,658) 297 
(f)
 (10,361)
Net income (loss) $ 28,242  $ (1,754) $ 26,488 
Net income (loss) per common share:
Basic $ 1.86  $ (0.12) $ 1.74 
Diluted $ 1.77  $ (0.11) $ 1.66 
The description of each error is described above. The impact of each error for the corresponding period in the above table is described below:
(a) Last Mile Freight - The correction of these misstatements resulted in an increase to cost of merchandise sold of $1.5 million for the year ended January 29, 2023.
(b) Leases - The correction of these misstatements resulted in a decrease to selling, general and administrative expenses of $0.1 million for the year ended January 29, 2023.
(c) Buyer’s Remorse - The correction of these misstatements resulted in a decrease to net sales of $0.4 million for the year ended January 29, 2023.
(f) Income Taxes - The tax impact of all misstatements resulted in a decrease to provision for income taxes of $0.3 million for the year ended January 29, 2023.
(g) Inventory and Cost of Goods Sold - The correction of these misstatements resulted in an increase to cost of merchandise sold of $0.3 million for the year ended January 29, 2023.
BALANCE SHEET

January 30, 2022
(amounts in thousands, except share and per share amounts) As Previously Reported Revisions Reference As Revised
Assets
Current Assets
Prepaid expenses and other current assets 15,726  (3,427)
(a)(b)(e)(f)
 12,299 
Total Current Assets 225,158  (3,427) 221,731 
Other Assets
Deferred tax asset 9,836  (115)
(f)
 9,721 
Other assets —  1,047  (e) 1,047 
Total Other Assets 11,393  932  12,325 
Total Assets $ 371,579  $ (2,495) $ 369,084 
Liabilities and Stockholders' Equity
Current Liabilities
Accrued expenses 40,497  362 
(a)(f)
 40,859 
Current operating lease liabilities 16,382  (4,445)
(b)(e)
 11,937 
Total Current Liabilities 118,779  (4,083) 114,696 
Total Liabilities 215,353  (4,083) 211,270 
Stockholders’ Equity
Accumulated (deficit) earnings (17,536) 1,588 
(a)(b)(f)
 (15,948)
Stockholders' Equity 156,226  1,588  157,814 
Total Liabilities and Stockholders' Equity $ 371,579  $ (2,495) $ 369,084 
The description of each error is described above. The impact of each error for the corresponding period in the above table is described below:
(a) Last Mile Freight - The correction of these misstatements resulted in an increase to prepaid expenses and other current assets of $0.1 million, a decrease to accrued expenses of $0.1 million, and a decrease to accumulated deficit of $0.2 million at January 30, 2022.
(b) Leases - The correction of these misstatements resulted in an increase to prepaid expenses and other current assets of $0.3 million, a decrease to current operating lease liabilities of $1.7 million, and a decrease to accumulated deficit of $2.0 million at January 30, 2022.
(e) Balance Sheet Reclassifications - The correction of these misstatements resulted in a decrease to prepaid expenses and other current assets of $3.8 million, a decrease to current operating lease liabilities of $2.8 million, and an increase to other assets of $1.0 million at January 30, 2022.
(f) Income Taxes - The tax impact of all misstatements resulted in an increase to prepaid expenses and other current assets of less than $0.1 million, a decrease to deferred tax asset of $0.1 million, an increase to accrued expenses of $0.5 million, and an increase to accumulated deficit of $0.5 million at January 30, 2022.