The Chicago-based company reported a "material weakness" in financial controls on March 30 and said fourth-quarter sales were lower than previously stated because of higher refunds to merchants. That cut revenue in the period - Groupon's first as a public company - by $14.3 million to $492.2 million.</p><p>

The announcement added to setbacks for Groupon, which has struggled to get its financial statements in order since filing for an initial public offering in June. The company abandoned an accounting method for operating income after a review by regulators and later restated 2010 results.

for starters, it’s not a coupon company nor a marketing company. At its core, Groupon’s U.S. business is a receivables factoring business, as I wrote last year. They give loans to small businesses at a very steep rate (the price of the discount plus Groupon’s commission). They get the money to fund these loans from credit card companies such as Chase Paymentech. Groupon is essentially a sub-prime lender that does zero risk assessment. And as word continues to spread about what a terrible deal running a Groupon is for many categories of businesses, the ones that will choose to run Groupons are the ones that are the most desperate. For U.S. based businesses, the only time I can definitely recommend running a Groupon is if it is otherwise going to go out of business.

Online coupon distributor Groupon (GRPN), in its first report since going public, this afternoon reported Q4 revenue ahead of analysts’ expectations but reported a surprise net loss instead of the expected profit.