East Hills, NY 1/29/08—Pall announced that it has completed its inquiry of the understatement of US federal income tax payments and the provision for income taxes from 1999 through 2006 (see IBO 8/31/07). The company found intercompany balances were due primarily to the sales of products by Pall Netherlands to Medsep, resulting in dividend income that was excluded from income tax returns. Pall has terminated four employees in connection with the matter and stated that it may have one or more material weaknesses in its internal control over financial reporting. In September 2007, the company deposited $135 million with the Internal Revenue Service (IRS), based on estimates of the taxes payable, excluding penalties. However, the company has not yet determined the impact on its financial statements or reached a resolution with the IRS. The SEC and US Attorney’s Office are also conducting inquiries.