HP Earnings Take Big Hit From Alleged “Accounting Improprieties” at Autonomy
Hewlett-Packard is accusing a British company it bought last year of misrepresenting its finances to make it seem more profitable than it really was.
HP is taking a nearly $9 billion charge on its quarterly earnings to reflect what it calls “serious accounting improprieties” by software maker, Autonomy.
HP CEO Meg Whitman says HP has referred the case to the U.S. Securities and Exchange Commission and the U.K.’s Serious Fraud Office.
“I think we all know that the legal system in both countries," Whitman said in a conference call. “This will take a long time to work through. But we are committed to seeking redress for the benefit of our shareholders. I suspect this is a multi-year journey through the courts in both countries.”
Whitman says the firm will go to civil courts to try to recoup some of the money it paid for Autonomy.
Autonomy’s founder Michael Lynch denies the accusations. He blames HP for the losses.