Beset by continuing accounting struggles, Peace Arch Entertainment is to write down its film and TV assets by $25 million for its fiscal year 2008, and will delay yet again the release of its latest year-end results.

Peace Arch may also restate for the second time results from 2006, and also 2007, to reflect the consolidation on its balance sheet of so-called ‘variable interest entities’ — essentially 10 movies produced in 2006 by non-owned single-purpose production companies.

‘At this time, the company is unable to estimate the final impact of the potential adjustments and possible restatement of the results for prior years,’ Peace Arch said in a statement.

Peace Arch CEO Gerry Noble offered no comment Monday on his company’s latest accounting woes beyond what was revealed in a formal press release.

As part of the statement, the Toronto company warned its latest accounting overhaul may have a ‘material adverse impact’ on its earnings.

The company has already decided to write down the value of its film and TV assets by around $21 million in the fourth quarter of 2008, on top of a third-quarter write-down of $4 million. That brings to $25 million the amount of write-downs Peace Arch so far expects to book for the year ending Aug. 31, 2008.

The company’s latest accounting problems follow a recent exit from in-house film production, especially direct-to-DVD genre pictures.

Peace Arch will now focus on direct DVD and theatrical distribution in North America, and TV production with successful titles like The Tudors.

But exorcising the accounting ghosts of past film production has been difficult for Peace Arch. Earlier this year, the company unveiled film write-downs after a prior financial audit and delay of its year-end results to Aug. 31, 2007.

While short on specifics in its latest revelations, Peace Arch said it will now have to fix accounting mistakes in 2006 and 2007 that stem from sub-distribution agreements that gave it international distribution rights to certain film titles.

The company earlier recognized around $3.8 million in distribution revenue and around $900,000 in net income in fiscal 2007 for those titles, and $2.9 million in distribution revenue and $1.1 million in net income for fiscal 2006.

Now Peace Arch has charged a committee of board members with probing its involvement with the film’s production companies via the sub-distribution agreements.

‘The board has concerns that certain transactions in connection with the non-owned production companies and the sub-distribution agreements may not have been appropriate and may not have been accounted for correctly,’ Peace Arch said in a statement.

‘Subject to the results of that review, the company may need to reduce the associated revenue and net income that was previously reported,’ it added.

Peace Arch’s last restatement of its results for full-year 2006, done to reflect higher interest charges on film production loans and higher income tax expenses, also rattled investors.

That, combined with the departure of former CEO Gary Howsam in late 2007, spurred a steady slide in Peace Arch’s stock price.

Stock in Peace Arch on Monday traded down 30% to $0.07 on the Toronto Stock Exchange.

Howsam, who is scheduled to go on trial in Los Angeles on seven counts of bank fraud on Feb. 3, was subsequently replaced as interim CEO by major shareholder and co-chairman Jeff Sagansky, a former co-president of Sony Entertainment.

Sagansky recently gave way for former Canwest Global Communications executive Gerry Noble, a corporate turnaround specialist, to come on board as permanent CEO.