The Inquirer-Home

HP might have known about Autonomy irregularities

Financial Times finds smoking emails
Tue Feb 18 2014, 17:11
hp-logo-blue

ENTERPRISE VENDOR HP might have known about irregularities in Autonomy financial reports and business transactions earlier than it claimed, it has emerged.

The Financial Times reported today that senior executives were aware of the British software house's shady practices of reselling hardware at a loss and massaging the books, and that auditors made the information available to parent company HP after it bought Autonomy but long before it wrote down the company's value by $8.8bn the following year.

The irregularities came to light after a whistleblower flagged the practices. HP claimed it knew nothing until that point, however the Financial Times obtained emails that contradicted this, showing that HP CEO Meg Whitman had received copies of certain files.

In a statement to Reuters, HP said, "Our investigation has shown that Autonomy often resold generic hardware at a loss in the last few days of the quarter with the sole purpose of masking its real financial performance."

"In addition, Autonomy engaged in improper transactions with certain value-added resellers to create the appearance of software licensing revenue at the end of each quarter. In some instances, these transactions were used to accelerate revenue, and on numerous occasions, these were fabricated transactions with no real end-user."

However Autonomy founder Mike Lynch refused to accept the allegations, saying, "Meg Whitman accused Autonomy of 'active concealment' but these revelations prove we were open and transparent with our auditors who continue to stand by the accounts."

This news might make for uncomfortable reading for HP. In the meantime, investigations continue. µ

 

Share this:

blog comments powered by Disqus
Advertisement
Subscribe to INQ newsletters

Sign up for INQbot – a weekly roundup of the best from the INQ

Advertisement
INQ Poll

Apple announces the iPhone 6, iPhone 6 Plus and Apple Watch

Which of Apple's new products will you be buying?