when companies issue restatements investors are advised to ascertain to the best of their abilities the seriousness of the error reported how much of an impact is it likely to have and more importantly was it an innocent mistake or something that appears to be more sinister look for indications from management on how it plans to stop similar mistakes from happening in the future 
it is also worth remembering that changes in certain financial estimates are not required as these are based on anticipated events and not ones that have already occurred these changes must only be reported on the next financial statement after the change is made and are not applied retroactively restatement faqsa restatement is the restatement of a revised financial statement the restatement is purposed to correct what was previously reported erroneously a reclassification involves correcting the classification of a transaction or entry moving it from one ledger to another for example one could reclassify an entry from a current asset to a long term asset a revision is the correction of a reported amount in subsequent financial statements 2 however the previously reported financial statement need not be reissued with a restatement on the other hand the error must be material prompting a revision and the issuance of a corrected financial statement the restatement of torts is a resource published by the american law institute ali explaining the law as it pertains to certain situations specifically involving torts 3 there are two restatement of torts restatement of the law second torts and restatement of the law third torts which is the most recent published version the restatement of contracts is a resource published by the american law institute ali explaining the law as it pertains to contracts 4 in other words they help courts clarify and interpret contract law the bottom line