Corporate Accountability

Corporate Accountability - THE WALL STREET JOURNAL....

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Unformatted text preview: THE WALL STREET JOURNAL. Corporate Accountability A look at companies whose business practices have been questioned, the issues involved and the auditor at the time. PERCENT CHANGE IN COMPANY ISSUE SHARE PRICE AUDITOR SINCE 1/14/00* v r . - n Adelphia i—Whether it failed to properly CllSClOSCI$3.1 billion 99-75% Deloitte & Touche 1n loans and guarantees to its founder 3 family. Disclosed it overstated revenue in 2000 and 2001 CMS Energy by including artificial 'round trip' energy trades. ‘66'46 Andersen Computer Whether it art1fic1ally inflated revenue and _7521 Ernst & Young Associates 5 improperly rewarded top executives. _ V Whether its 'Project Alpha' transactions served Dynegy . primarily to cut taxes and artificially increase cash -71.09 Andersen v flow. , Admitted it improperly inflated earnings and hid _ d ! Enron i debt through business partnerships. « 99'80 An ersen I Global Whether it sold its telecom capacity in a way that _ d Crossing artificially boosted its 2001 cash revenue. 99'87 An ersen i Hamburton Whether it improperly recorded revenue from cost _591 5 Andersen __ overruns on big construction JObS. l . ___ |.__ r _ . ImClone Former CEO Samuel Waksal charged with insider I . -83.08 KPMG Systems trading. ‘5 I—" F Says the SEC is investigating its accounting and Kmart other practices. The company investigated whether _90-40 . Pricewaterhousecoopers it Improperly accounted for vendor allowances, and since changed its practice. ___.-u_.,.__—___ ' Adjusted fiscal 2000 revenues by $679 million, Lucent spurring SEC investigation. Agency also - C Technologies investigating whether vendor-financing played an 9697 Pncewaterhouse OOpers g improper role in its sales. ll Settled without admitting wrongdoing an SEC suit ‘I i MicroStrategy accusmg It Ofbaideating sales commas to.me.et -99.53 PricewaterhouseCoopers ; quarterly financml estimates, among other improper ; ll revenue-recognition practices. f._—_fi_-_f—....: TM— __________ _______ _ _ rm“.-. _ ___ ___ f| gig-:1; gzthgrzgggd expenses or overstated revenue from _355? Pricewalerhousecoopers PNC Financial - Restated its 200] results by $155 million after a . regulators raised concerns about how PNC . + {0.5? Ernst & Young seW1ces nnnnn onus-.4 Pm.- n runny-Po.- “F Ian-n1» i l Page 1 of2 ,_u_._.#__...______a.___.__ Whether it inflated revenue for 2000 and 2001 . through capacity swaps and equipment sales. Admitted it inflated revenue by counting artificial Qwest Reliant Resources Rite Aid Tyco International WorldCom Xerox r_H—_ -93.54 Andersen 'round trip' energy trades. l——#F‘_ Acknowledged overstating net income by $1.6 ! billion. Former executives are charged with 2 performance. l Whether it improperly created 'cookie jar' reserves - that were supposed to cover merger costs but instead were drawn on to boost profits; and whether it improperly 'spring-loaded' earnings from outlays. collect. inflating earnings to reap rewards tied to financial acquisitions by accelerating their pre-merger Admitted to improperly booking $3.8 billion in expenses as capital expenditures. Still unresolved is whether it used questionable methods to book sales, i classify assets and account for debts it couldn't N.A. Deloitte & Touche -68.01 KPMG -64.32 PricewaterhouseCoopers Andersen Fined $10 million without admitting or denying :; wrongdoing for inflating revenue and profits fi'om 1997 to 2000 by including future payments on ' existing contracts. -66.04 KPMG *Jan. 14, 2000 was the date the Dow Jones Industrial Average hit its all-time high; all percent changes compare share prices on that date to closing share prices on June 27, 2002. Sources,” WSJ research; WSJ Market Data Group Copyright 2002 Dow Jones & Company, Inc. All Rights Reserved Page 2 of 2 ...
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This note was uploaded on 10/12/2010 for the course MBA 11111 taught by Professor Spike during the Fall '10 term at Lewis University .

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Corporate Accountability - THE WALL STREET JOURNAL....

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