Dell delays annual filing, finds evidence of misconduct in finance probe
Dell announced that it will delay the filing of the Form 110-K for its fiscal year beyond April 3, 2007 deadline and the subsequent extension date of April 18, 2007 because the independent financial investigation by Audit Committee has not been completed but has found evidence of misconduct.
As previously announced, the Audit Committee of the company’s Board of Directors is conducting an independent investigation into certain accounting and financial reporting matters.
Dell did not say what sort of misconduct it had found or who had committed it. In a brief statement, the company said only that an audit committee it had assigned to investigate the SEC charges had “identified a number of accounting errors, evidence of misconduct, and deficiencies in the financial control environment.”
“As we move toward the conclusion of our investigation, we are committing the time and resources required to ensure a thorough and comprehensive review and resolution of all identified issues and the implementation of appropriate remedial measures,” Thomas W. Luce III, chairman of Dell’s audit committee, said in the statement.
Dell, said that the audit committee was working with management and the company’s independent auditors to determine whether the errors would require the restatement of previous earnings reports.
Thomas Luce III, said Dell would take “appropriate remedial measures” after a “thorough and comprehensive review.”
In August, company officials said Dell received a letter from the SEC requesting information on “revenue recognition and other accounting and financial reporting matters” for past fiscal years.
In September, Dell said the U.S. attorney for the Southern District of New York has subpoenaed documents related to its financial reporting from 2002 to the present.
Dell hasn’t disclosed full details of what the SEC is investigating, beyond a statement last year that the probe might involve “accruals, reserves and other balance sheet items.”
Dell also faces a slew of shareholder lawsuits, alleging that the company manipulated its accounting to hide as much as $1 billion in illegal payments from chipmaker Intel Corp.
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