SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K/A

Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 15, 2009

Integrated Electrical Services, Inc.

(Exact name of registrant as specified in Charter)

Delaware (State or Other Jurisdiction of Incorporation)		001-13783 (Commission File Number)		76-0542208 (I.R.S. Employer Identification Number)

1800 West Loop South, Suite 500
Houston, Texas 77027
(Address of Principal Executive Offices)

Registrant’s telephone number, including area code: (713) 860-1500

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2 (b))

o		Pre-Commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))

 

 

EXPLANATORY NOTE

     This Current Report on Form 8-K/A (this “Amendment No. 1”) updates the Current Report on Form 8-K filed by Integrated Electrical Services, Inc. on September 21, 2009 (the “Form 8-K”) to add as Exhibit 99.1 the Company’s adjusted Balance Sheet and Statement of Operation as of and for the fiscal year ended September 30, 2008, as of and for the three months ended December 31, 2008, as of and for the three and six months ended March 31, 2009 and as of and for the three and nine months ended June 30, 2009. Additionally, this Amendment No. 1 updates from the Form 8-K (i) the amount of non-cash charges that should have been included in the Company’s unaudited condensed consolidated financial statements for the three months ended December 31, 2008 and (ii) the aggregate amount of adjustments to fixed assets and depreciation expense, which were discovered by the Company during the fiscal quarter ended June 30, 2009.

Item 4.02(a).		Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review.

     On September 15, 2009, the Audit Committee of the Board of Directors of Integrated Electrical Services, Inc. (the “Company”), upon the recommendation of management and after discussion with the Company’s independent registered public accounting firm, Ernst & Young LLP, concluded that (i) the Company’s audited consolidated financial statements as of and for the fiscal year ended September 30, 2008 and (ii) the Company’s unaudited condensed consolidated financial statements as of and for the three months ended December 31, 2008, as of and for the three and six months ended March 31, 2009 and as of and for the three and nine months ended June 30, 2009 (collectively, with the fiscal year ended September 30, 2008, the “Prior Periods”), should no longer be relied upon as being in compliance with U.S. Generally Accepted Accounting Principles (GAAP).

     As disclosed in the Company’s quarterly report on Form 10-Q for the fiscal quarter ended June 30, 2009, the Company has previously undertaken an evaluation, based on the guidance in Statement of Financial Accounting Standard No. 154 “Accounting Changes & Error Corrections” (“SFAS 154”), Accounting Principles Board No. 28 “Interim Financial Reporting” (“APB 28”), Statement of Financial Accounting Standard No. 16 “Prior Period Adjustments” (“SFAS 16”), SEC Staff Accounting Bulletin No. 99 “Materiality” (“SAB 99”) and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB 108”), to determine whether a restatement of the Prior Period financial statements was required as a result of errors recorded during such Prior Periods.

     SFAS 154 requires that corrections of errors be recorded by restatement of prior periods if the errors are material. While in previous periods management had considered the Prior Period errors to be immaterial, after additional consultation with the Securities and Exchange Commission, and the Company’s independent registered public accounting firm, the Company concluded that it will restate the previously issued financial statements for each of the Prior Periods.

     The Company’s audited consolidated financial statements as of and for the fiscal year ended September 30, 2008, should have included $0.4 million in non-cash charges (net, after tax) that were recorded in the first and second quarters of fiscal year 2009. In addition, the unaudited condensed consolidated financial statements for the three months ended December 31, 2008 should have included an additional $0.6 million in non-cash charges (net, after tax) that were recorded in the second and third quarters of fiscal year 2009. The tables attached as Exhibit 99.1 hereto reflect the correction of these errors.

     These accounting errors primarily include additional non-cash charges for miscellaneous accruals, medical claims, and intercompany expenses that should have been accrued at September 30, 2008 and December 31, 2008 but were, instead, reflected in the income statement for the fiscal quarter ended March 31, 2009. These errors were primarily identified in the fiscal quarter ended March 31, 2009 and resulted from control weaknesses at the Company’s corporate office. These control issues were both identified and remediated during fiscal quarter ended March 31, 2009. Accordingly, internal controls have been strengthened by improving the corporate office account reconciliation process and implementing certain staffing changes.

     In addition, during the fiscal quarter ended June 30, 2009, the Company discovered adjustments to fixed assets and depreciation expense, totaling $0.1 million in non-cash benefits (net, after tax), that should have been recorded during the Prior Periods. This error, which impacted fixed assets and related depreciation, was discovered through the implementation of the Company’s enhanced fixed asset accounting system.

     The errors disclosed herein did not impact the Company’s previously reported cash and cash equivalents or loan covenants for any of the Prior Periods. The Company is continuing to assess all necessary adjustments and will issue restated financial statements for the Prior Periods as soon as practicable after their preparation, review, and completion. While the Company cannot accurately predict when the preparation of the restated financial statements will be completed, it is anticipated that all restatements will be completed prior to the filing of the Company’s annual report on Form 10-K for the fiscal year ending September 30, 2009.

Item 9.01.		Financial Statements and Exhibits.

     (d) Exhibits.

Exhibit Number		Description
Exhibit 99.1		Adjusted Balance Sheet and Statement of Operation of Integrated Electrical Services Inc. as of and for the fiscal year ended September 30, 2008, as of and for the three months ended December 31, 2008, as of and for the three and six months ended March 31, 2009 and as of and for the three and nine months ended June 30, 2009

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

EXHIBIT INDEX

Exhibit Number		Description
Exhibit 99.1		Adjusted Balance Sheet and Statement of Operation of Integrated Electrical Services Inc. as of and for the fiscal year ended September 30, 2008, as of and for the three months ended December 31, 2008, as of and for the three and six months ended March 31, 2009 and as of and for the three and nine months ended June 30, 2009

Exhibit 99.1

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE INFORMATION)

		September 30, 2008
		As								As
		Reported				Adjustments				Restated
						(Unaudited)				(Unaudited)
Assets:
Current Assets
Cash and cash equivalents		$	64,709			$	—			$	64,709
Accounts receivable:
Trade, net			132,273				—			$	132,273
Retainage			30,833				—			$	30,833
Cost and estimated earnings in excess of billings on uncompleted contracts			14,743				—			$	14,743
Inventories			12,856				—			$	12,856
Prepaid expenses and other current assets			6,711				—			$	6,711
Assets held for sale from discontinued operations			2,034				—			$	2,034
Total current assets			264,159				—				264,159
Property and equipment, net			25,742				381			$	26,123
Goodwill, net			4,395				—			$	4,395
Other noncurrent assets, net			25,480				—			$	25,480
Total assets		$	319,776			$	381			$	320,157
Liabilities and Stockholders’ Equity
Current Liabilities
Current maturities of long-term debt			2,905				—			$	2,905
Accounts payable and accrued expenses			98,046				808			$	98,854
Billings in excess of cost and estimated earnings on uncompleted contracts			33,711				—			$	33,711
Liabilities related to assets held for sale and from discontinued operations			504				—			$	504
Total current liabilities			135,166				808				135,974
Long-term debt, net of current maturities			26,739				—			$	26,739
Other noncurrent liabilities			10,765				—			$	10,765
Total liabilities			172,670				808				173,478
Stockholders’ equity			147,106				(427	)			146,679
Total liabilities and stockholders’ equity		$	319,776			$	381			$	320,157

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE INFORMATION)

		Year ended September 30, 2008
		As								As
		Reported				Adjustments				Restated
						(Unaudited)				(Unaudited)
Revenues		$	818,287			$	—			$	818,287
Cost of services			686,407				(49	)			686,358
Gross profit			131,880				49				131,929
Selling, general and administrative expenses			117,366				1,678				119,044
(Gain) loss on sale of assets			(114	)			—				(114	)
Restructuring charges			4,815				—				4,815
Income from operations			9,813				(1,629	)			8,184
Other (income) expense
Interest expense			8,623				—				8,623
Interest (income)			(2,094	)			—				(2,094	)
Other, net			(673	)			—				(673	)
Interest and other expense, net			5,856				—				5,856
Income from continuing operations before income taxes			3,957				(1,629	)			2,328
Provision for income taxes			2,921				(1,202	)*			1,719
Net income (loss) from continuing operations			1,036				(427	)			609
Discontinued operations
Loss from discontinued operations			(549	)			—				(549	)
Provision (benefit) for income taxes			(197	)			—				(197	)
Net loss from discontinued operations			(352	)			—				(352	)
Net Income (loss)		$	684				(427	)			257
Basic earnings (loss) per share:
Continuing operations		$	0.07			$	(0.03	)		$	0.04
Discontinued operations		$	(0.02	)		$	0.00			$	(0.02	)
Total		$	0.05			$	(0.03	)		$	0.02
Diluted earnings (loss) per share
Continuing operations		$	0.07			$	(0.03	)		$	0.04
Discontinued operations		$	(0.02	)		$	0.00			$	(0.02	)
Total		$	0.05			$	(0.03	)		$	0.02
Shares used in the computation of earnings (loss) per share:
Basic			14,938,619
Diluted			15,025,023

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE INFORMATION)

		December 31, 2008
		As								As
		Reported				Adjustments				Restated
		(Unaudited)				(Unaudited)				(Unaudited)
Assets:
Current Assets
Cash and cash equivalents		$	49,294			$	—			$	49,294
Accounts receivable:
Trade, net			122,678				—			$	122,678
Retainage			31,244				—			$	31,244
Cost and estimated earnings in excess of billings on uncompleted contracts			12,316				—			$	12,316
Inventories			12,589				—			$	12,589
Prepaid expenses and other current assets			6,530				—			$	6,530
Assets held for sale from discontinued operations			1,860				—			$	1,860
Total current assets			236,511				—				236,511
Property and equipment, net			24,991				297			$	25,288
Goodwill, net			4,383				—			$	4,383
Other noncurrent assets, net			20,999				—			$	20,999
Total assets		$	286,884			$	297			$	287,181
Liabilities and Stockholders’ Equity
Current Liabilities
Current maturities of long-term debt			2,717				—			$	2,717
Accounts payable and accrued expenses			64,806				1,306			$	66,112
Billings in excess of cost and estimated earnings on uncompleted contracts			37,483				—			$	37,483
Liabilities related to assets held for sale and from discontinued operations			372				—			$	372
Total current liabilities			105,378				1,306				106,684
Long-term debt, net of current maturities			26,215				—			$	26,215
Other noncurrent liabilities			11,699				—			$	11,699
Total liabilities			143,292				1,306				144,598
Stockholders’ equity			143,592				(1,009	)			142,583
Total liabilities and stockholders’ equity		$	286,884			$	297			$	287,181

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE INFORMATION)

		Three months ended December 31, 2008
		As								As
		Reported				Adjustments				Restated
		(Unaudited)				(Unaudited)				(Unaudited)
Revenues		$	173,370			$	—			$	173,370
Cost of services			143,710				397				144,107
Gross profit			29,660				(397	)			29,263
Selling, general and administrative expenses			28,801				409				29,210
(Gain) loss on sale of assets			(103	)			—				(103	)
Restructuring charges			392				—				392
Income from operations			570				(806	)			(236	)
Other (income) expense
Interest expense			985				—				985
Interest (income)			(160	)			—				(160	)
Other, net			(151	)			—				(151	)
Interest and other expense, net			674				—				674
Income from continuing operations before income taxes			(104	)			(806	)			(910	)
Provision for income taxes			(29	)			(224	)*			(253	)
Net income (loss) from continuing operations			(75	)			(582	)			(657	)
Discontinued operations
Loss from discontinued operations			(29	)			—				(29	)
Provision (benefit) for income taxes			(14	)			—				(14	)
Net loss from discontinued operations			(15	)			—				(15	)
Net Income (loss)		$	(90	)			(582	)			(672	)
Basic earnings (loss) per share:
Continuing operations		$	(0.01	)		$	(0.03	)		$	(0.04	)
Discontinued operations		$	0.00			$	0.00			$	0.00
Total		$	(0.01	)		$	(0.03	)		$	(0.04	)
Diluted earnings (loss) per share
Continuing operations		$	(0.01	)		$	(0.03	)		$	(0.04	)
Discontinued operations		$	0.00			$	0.00			$	0.00
Total		$	(0.01	)		$	(0.03	)		$	(0.04	)
Shares used in the computation of earnings (loss) per share:
Basic			14,318,776
Diluted			14,318,776

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE INFORMATION)

		March 31, 2009
		As								As
		Reported				Adjustments				Restated
		(Unaudited)				(Unaudited)				(Unaudited)
Assets:
Current Assets
Cash and cash equivalents		$	51,569			$	—			$	51,569
Accounts receivable:
Trade, net			127,089				—				127,089
Retainage			30,114				—				30,114
Cost and estimated earnings in excess of billings on uncompleted contracts			10,623				—				10,623
Inventories			15,259				—				15,259
Prepaid expenses and other current assets			7,752				—				7,752
Assets held for sale from discontinued operations			392				—				392
Total current assets			242,798				—				242,798
Long-term receivable			3,730				—				3,730
Property and equipment, net			24,780				188				24,968
Goodwill, net			4,373				—				4,373
Other noncurrent assets, net			20,366				—				20,366
Total assets		$	296,047			$	188			$	296,235
Liabilities and Stockholders’ Equity
Current Liabilities
Current maturities of long-term debt			2,503				—				2,503
Accounts payable and accrued expenses			75,816				(73	)			75,743
Billings in excess of cost and estimated earnings on uncompleted contracts			36,487				—				36,487
Liabilities related to assets held for sale and from discontinued operations			319				—				319
Total current liabilities			115,125				(73	)			115,052
Long-term debt, net of current maturities			26,385				—				26,385
Other noncurrent liabilities			11,852				—				11,852
Total liabilities			153,362				(73	)			153,289
Stockholders’ equity			142,685				261				142,946
Total liabilities and stockholders’ equity		$	296,047			$	188			$	296,235

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE INFORMATION)

		Three months ended March 31, 2009												Six months ended March 31, 2009
		As								As				As								As
		Reported				Adjustments				Restated				Reported				Adjustments				Restated
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenues		$	167,305			$	—			$	167,305			$	340,675			$	—			$	340,675
Cost of services			137,517				(348	)			137,169				281,227				49				281,276
Gross profit			29,788				348				30,136				59,448				(49	)			59,399
Selling, general and administrative expenses			29,147				(2,246	)			26,901				57,546				(1,837	)			55,709
(Gain) loss on sale of assets			(75	)			—				(75	)			(178	)			0				(178	)
Restructuring charges			1,908				366				2,274				2,702				366				3,068
Income from operations			(1,192	)			2,228				1,036				(622	)			1,422				800
Other (income) expense
Interest expense			1,105				—				1,105				2,090				—				2,090
Interest (income)			(113	)			—				(113	)			(273	)			—				(273	)
Other, net			(67	)			—				(67	)			(217	)			—				(217	)
Interest and other expense, net			925				—				925				1,600				—				1,600
Income from continuing operations before income taxes			(2,117	)			2,228				111				(2,222	)			1,422				(800	)
Provision for income taxes			(926	)			958	*			32				(955	)			734	*			(221	)
Net income (loss) from continuing operations			(1,191	)			1,270				79				(1,267	)			688				(579	)
Discontinued operations
Loss from discontinued operations			(73	)			—				(73	)			(102	)			—				(102	)
Provision (benefit) for income taxes			(30	)			—				(30	)			(44	)			—				(44	)
Net loss from discontinued operations			(43	)			—				(43	)			(58	)			—				(58	)
Net Income (loss)		$	(1,234	)		$	1,270			$	36			$	(1,325	)		$	688			$	(637	)
Basic earnings (loss) per share:
Continuing operations		$	(0.08	)		$	0.09			$	0.01			$	(0.09	)		$	0.05			$	(0.04	)
Discontinued operations		$	(0.01	)		$	0.00			$	(0.01	)		$	0.00			$	0.00			$	0.00
Total		$	(0.09	)		$	0.09			$	0.00			$	(0.09	)		$	0.05			$	(0.04	)
Diluted earnings (loss) per share
Continuing operations		$	(0.08	)		$	0.09			$	0.01			$	(0.09	)		$	0.05			$	(0.04	)
Discontinued operations		$	(0.01	)		$	0.00			$	(0.01	)		$	0.00			$	0.00			$	0.00
Total		$	(0.09	)		$	0.09			$	0.00			$	(0.09	)		$	0.05			$	(0.04	)
Shares used in the computation of earnings (loss) per share:
Basic			14,322,439												15,015,717
Diluted			14,322,439												15,021,520

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE INFORMATION

		June 30, 2009
		As								As
		Reported				Adjustments				Restated
		(Unaudited)				(Unaudited)				(Unaudited)
Assets:
Current Assets
Cash and cash equivalents		$	60,544			$	—			$	60,544
Accounts receivable:
Trade, net			120,795				—				120,795
Retainage			31,110				—				31,110
Cost and estimated earnings in excess of billings on uncompleted contracts			10,074				—				10,074
Inventories			15,750				—				15,750
Prepaid expenses and other current assets			7,320				—				7,320
Assets held for sale from discontinued operations			511				—				511
Total current assets			246,104				—				246,104
Long-term receivable			3,732				—				3,732
Property and equipment, net			25,932				—				25,932
Goodwill, net			4,330				—				4,330
Other noncurrent assets, net			19,235				—				19,235
Total assets		$	299,333			$	—			$	299,333
Liabilities and Stockholders’ Equity
Current Liabilities
Current maturities of long-term debt			3,556				—				3,556
Accounts payable and accrued expenses			77,813				(244	)			77,569
Billings in excess of cost and estimated earnings on uncompleted contracts			34,407				—				34,407
Liabilities related to assets held for sale and from discontinued operations			332				—				332
Total current liabilities			116,108				(244	)			115,864
Long-term debt, net of current maturities			25,980				—				25,980
Other noncurrent liabilities			12,463				—				12,463
Total liabilities			154,551				(244	)			154,307
Stockholders’ equity			144,782				(244	)			145,026
Total liabilities and stockholders’ equity		$	299,333			$	—			$	299,333

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE INFORMATION)

		Three months ended June 30, 2009												Nine months ended June 30, 2009
		As								As				As								As
		Reported				Adjustments				Restated				Reported				Adjustments				Restated
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Revenues		$	172,185			$	—			$	172,185			$	512,860			$	—			$	512,860
Cost of services			139,858				—				139,858				421,085				49				421,134
Gross profit			32,327				—				32,327				91,775				(49	)			91,726
Selling, general and administrative expenses			26,671				159				26,830				84,216				(1,678	)			82,538
(Gain) loss on sale of assets			(221	)			—				(221	)			(399	)			—				(399	)
Restructuring charges			645				(57	)			588				3,347				309				3,656
Income from operations			5,232				(102	)			5,130				4,611				1,320				5,931
Other (income) expense
Interest expense			1,325				—				1,325				3,415				—				3,415
Interest (income)			(67	)			—				(67	)			(340	)			—				(340	)
Other, net			621				—				621				404				—				404
Interest and other expense, net			1,879				—				1,879				3,479				—				3,479
Income from continuing operations before income taxes			3,353				(102	)			3,251				1,132				1,320				2,452
Provision for income taxes			1,896				(85	)*			1,811				941				649	*			1,590
Net income (loss) from continuing operations			1,457				(17	)			1,440				191				671				862
Discontinued operations
Loss from discontinued operations			217				—				217				115				—				115
Provision (benefit) for income taxes			117				—				117				73				—				73
Net loss from discontinued operations			100				—				100				42				—				42
Net Income (loss)		$	1,557			$	(17	)		$	1,540			$	233			$	671			$	904
Basic earnings (loss) per share:
Continuing operations		$	0.10			$	0.00			$	0.10			$	0.02			$	0.04			$	0.06
Discontinued operations		$	0.01			$	0.00			$	0.01			$	0.00			$	0.00			$	0.00
Total		$	0.11			$	0.00			$	0.11			$	0.02			$	0.04			$	0.06
Diluted earnings (loss) per share
Continuing operations		$	0.10			$	0.00			$	0.10			$	0.02			$	0.04			$	0.06
Discontinued operations		$	0.01			$	0.00			$	0.01			$	0.00			$	0.00			$	0.00
Total		$	0.11			$	0.00			$	0.11			$	0.02			$	0.04			$	0.06
Shares used in the computation of earnings (loss) per share:
Basic			14,399,066												14,326,747
Diluted			14,403,139												14,348,238