I may have read Autonomy whistleblower emails about 'inflated' sales, founder Mike Lynch admits in court A senior finance department worker at Autonomy blew the whistle a year before it was purchased in 2011 by HP, saying the Brit software house was recognising revenue on deals before contracts were even signed. In an explosive July 2010 email to Autonomy's US CFO that was shown to London's High Court on Monday, Percy Tejeda – …
And what was Deloitte's response to Tejeda? I think that we should be told: just in case anyone is considering a deep pocket liability action against them you know.
This is certainly a trial that just keeps getting better and better. It is almost a shame that it isn't being televised.
Especially since the SCOTUS basically made it illegal (or much tougher anyway) for the government to prosecute auditor companies as an entity. Because Arthur Anderson is of course the party wronged when they allowed Enron and WorldCom (and Sunbeam, etc, etc). Again more late capitalism.
The individuals involved should have been charged and prosecuted not the entire company. Many of the employees had nothing to do with the fiascoes but took the brunt as the company collapsed. The basic problem was an unethical prosecutor who was not after justice but scalps. There were people in Anderson who should have been nailed but were not.
Pretty obvious the company's culture was rotten to the core and was well known for being so by the 1990s (have dodgy financials but can afford huge side consulting contracts Arthur Anderson was just the ticket). Just following orders is always the excuse. Some organizations need to be razed. USA gymnastics for example. AA got what they deserved because as an auditor especially trust is crucial. Will readily admit plenty of decision makers should have seen some prison time as well.
"I didn't realize that some execs think it's ok to count chickens before they hatch."
While it looks like dodgy accounting practices, at the moment this is likely to be a rounding error in any sets of publicly filed accounts.
It would be interesting to see what Deloittes thought/advised.
To put it into perspective, if Meg didn't need to concern herself with the details of a ~$11bn deal because HP was earning $120bn/year in revenue (i.e. approx 10% of annual revenue) then Mike probably wouldn't worry about $500k out of ~$950m (i.e. approx 0.5% of annual revenue)
if Meg didn't need to concern herself with the details of a ~$11bn deal because HP
Meg had nothing to do with this deal, this was made before her time. She had to oversee the writedown.
Leo Apotheker was the CEO of HP, and the driver behind this deal.
As per a wikipedia quote I have provided before on this topic:
During Apotheker's tenure at HP the stock dropped about 40%. It dropped nearly 25% on 19 August 2011, after HP announced a number of seemingly abrupt strategic decisions: to discontinue its webOS device business (mobile phones and tablet computers), to begin planning to divest its personal computer division, and to acquire British software firm Autonomy for a significant premium.[14] Over the months following Apotheker's departure, HP eventually spun off the remaining webOS assets into a new subsidiary, Gram; backtracked on any plans to spin-off its personal computer division; and wrote-down almost $9 billion related to the Autonomy acquisition, which it indicated was due to a lack of due diligence during the acquisition process under Apotheker.[15]Though Apotheker served barely ten months, he received over $13 million in compensation: a severance payment of $7.2 million, shares worth $3.56 million, and a performance bonus of $2.4 million,[17] although the company lost more than $30 billion in market capitalization during his tenure.
entertaining in a 50 shades of water colored counterfeit currency sort of way.
It's like someone walking into a store with a $1,000,000 bill and the boss authorizing the sales clerk to accept it for all that merchandise because "it will stay in the safe listed as an asset until we give the company merging with us the combination, and by that time we will have pocketed these great bonuses"
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