An independent auditor questioned U.S. Industries¿ ability to survive after the company reported a net loss for FY 2001 of $524.6 million on sales of $1.1 billion. The loss included about $233 million in write-offs associated with disposal of assets.

U.S. Industries has been disposing of non-core businesses in order to focus on principal bath and plumbing brands Jacuzzi, Zurn, Sundance Spas and Eljer, along with Rainbow Cleaners, a consumer vacuum cleaner company. The company was seeking to refinance debt and sell off assets in order to survive, but stated "while the company believes it should be possible to implement such a further restructuring, there can be no assurance at this time that it will be able to do so." Because of the uncertainties, the company said its "independent auditor has included a qualification in its report ¿ with respect to the ability of the company to continue as a going concern."