Feeds

SEC probes Lucent accounting practice

Allegations of revenue misreporting

  • alert
  • submit to reddit

Internet Security Threat Report 2014

An investigation into possibly fraudulent accounting at telecommunications equipment maker Lucent has been begun by the Securities and Exchange Commission (SEC), according to a report in today's Wall Street Journal.

The paper quotes unnamed sources "familiar with the investigation" who said the inquiry by the SEC's enforcement division will focus on whether Lucent improperly booked $679m in revenue during its last financial year, which ended on September 30.

Among Lucent business practices reportedly to be probed include its use of one-time discounts to clients and its reporting of software licensing agreements.

The SEC is also said to be looking at how Lucent recognised revenue on channel sales and how the company set revenue targets for fiscal 2000.

Lucent restated the revenues for the period under investigation in December after conducting its own investigation.

The Journal quotes Lucent spokeswoman Kathleen Fitzgerald who said the firm is co-operating with the investigation.

She said that Lucent has shared its finding which led to the revenue restatement with the commission and also given the SEC copies of an external audit conducted by PricewaterhouseCoopers and Lucent's outside counsel, Cravath, Swaine & Moore.

As previously reported, last month Lucent said it would shed 16,000 jobs and begin a seven-part restructuring plan to reduce its costs by $2 billion in an attempt to return its business to profitability. Announcement of the job cuts came when it announced a first quarter net loss of $395 million on sales of $5.84 billion. ®

Related stories

Lucent unveils IP strategy targeted at telcos
Lucent to restate sales and cut 10,000 jobs
Blunder cuts Lucent Q1 sales by $125m

Providing a secure and efficient Helpdesk

More from The Register

next story
Doctor Who's Flatline: Cool monsters, yes, but utterly limp subplots
We know what the Doctor does, stop going on about it already
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
'Cowardly, venomous trolls' threatened with TWO-YEAR sentences for menacing posts
UK government: 'Taking a stand against a baying cyber-mob'
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Zippy one-liners, broken promises: Doctor Who on the Orient Express
Series finally hits stride, but Clara's U-turn is baffling
Don't bother telling people if you lose their data, say Euro bods
You read that right – with the proviso that it's encrypted
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Win a year’s supply of chocolate
There is no techie angle to this competition so we're not going to pretend there is, but everyone loves chocolate so who cares.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.