[DESCRIPTION] Amendment To Quarterly Report
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q/A
AMENDMENT TO FORM 10-Q QUARTERLY REPORT
FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 1998
COMMISSION FILE NUMBER 0-9061
Filed pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
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ELECTRO RENT CORPORATION
6060 Sepulveda Blvd.
Van Nuys, California 91411
(818) 786-2525
Amendment No. 1
The purpose of this amendment is to add Year 2000 compliance disclosure to
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations in the Electro Rent Corporation Form 10-Q for the quarterly
period ended August 31, 1998, filed on October 9, 1998, as follows:
Year 2000 Compliance
General. The computer systems issue relating to dates beyond 1999 is the
result of many computer programs being written to use and store dates with
only the last two digits of the applicable year. As a result, these programs
may assume that all two digit dates are twentieth century dates. This could
result in system failure, anomalous system behavior or incorrect system
reporting. System failure could, in turn, temporarily affect the Company's
ability to process customer transactions, interface with vendors and engage in
similar normal business activities.
The Company has assessed how it may be impacted. The Company has formulated
and begun implementation of a plan to address all known aspects of the issue.
The Company has already completed a substantial portion of this plan and is on
schedule to fully complete the plan by May 1999.
Software Information Systems. Software information systems consist of the
Company's base financial and operations system (internally-developed PERFECT
system), other smaller scale software applications and other programs
developed internally. All of these systems were found to be substantially
year 2000 compliant with immaterial associated costs.
Vendor Provided Computer Hardware and Operating Systems. Vendor provided
computer hardware and operating systems include all data center equipment (Sun
Microsystems Enterprise 6000) and networks (Novell and Microsoft NT). All of
these systems were found to be substantially year 2000 compliant with the
exception of the Sun 6000 operating system. This will be upgraded in February
1999 with immaterial associated costs.
Communications Systems. Communications systems include all data center
equipment and software systems used to support external communications with
customers, employees, suppliers and business partners, and all corporate
equipment and software systems used to support internal business management
communications. Corporate communications systems have been recently replaced
and/or upgraded. Each significant component of these communications systems
has been tested and all were found to be substantially year 2000 compliant
with immaterial associated costs. The Company is currently evaluating
communications systems at each of its field offices and will make any
necessary replacements and/or upgrades by May 1999. The Company does not
expect any associated costs to be material.
Suppliers and Other Business Partners. This area of the plan called for all
significant suppliers and other business partners to be monitored for year
2000 readiness. The Company is not currently aware of any single vendor or
business partner with year 2000 compliance issues that could have a material
impact on the Company. Year 2000 business transaction tests of all direct
interfaces with vendors and other business partners will be completed by May
1999. The Company can provide no assurance that year 2000 compliance will be
successfully implemented by all of its suppliers.
Contingency Planning. The Company has not yet developed a comprehensive
contingency plan to address the risk of operational problems and costs likely
to result from a failure by the Company or by a supplier or business partner
to address year 2000 readiness. This plan will be developed by the end of May
1999. It will list specific action plans for failure in any of the identified
areas of the year 2000 compliance plan. The Company believes that failure to
complete any of the remaining work to be done will not alone adversely affect
the continuity of the core business. The Company believes its current state
of readiness is on schedule with a conservative plan to be fully year 2000
compliant by May 1999 and that business risks have been minimized. However,
there can be no guarantee that year 2000 compliance issues not yet identified
or fully addressed will not materially affect the Company's operations or
expose it to third party liability.
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this amendment to be signed on its behalf by the
undersigned thereunto duly authorized.
ELECTRO RENT CORPORATION
Date: January 14, 1999 /s/ Craig R. Jones
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CRAIG R. JONES
Vice President of Finance,
Chief Financial Officer
