Posted on 04/30/2003 6:03:11 PM PDT by Fractal Trader
Edited on 04/22/2004 11:48:49 PM PDT by Jim Robinson. [history]
BOSTON -- Tyco International Ltd., acknowledging a raft of new accounting problems, took big charges to clean up its books and reported a $468 million loss for its fiscal second quarter.
Some investors said the latest accounting problems, the fourth announced by Tyco since October, further eroded the credibility of the giant conglomerate's new management team. But others were cheered by the quarter's strong cash flow, and were optimistic that Tyco may have finally put most of the bookkeeping issues behind it.
(Excerpt) Read more at online.wsj.com ...
PWC? Of course not. How dare anyone think such dastardly thoughts (/sarcasm off).
(And BTW, Boies, better tell your man, Algore, there really is a controlling legal authority.)
Another person coming in for criticism was attorney David Boies, who in December released his review of Tyco's accounting, noting that 125 lawyers and accountants spent 65,000 hours going over the company's books. The report, which cost Tyco $55 million, found some relatively small accounting errors and a pattern of aggressive bookkeeping, but no "systemic fraud." Mr. Boies has pointed out that the report was carefully hedged, noting for example that it looked at just 15 major acquisitions out of more than 700 companies bought.
But since the Boies report was issued, Tyco has said it found more than $1.6 billion in additional problems requiring new charges. Chuck Mulford, an accounting professor at Georgia Tech University in Atlanta, said it "sounds like the Boies report was more PR than anything else. If you do this kind of thing, but limit the scope so you don't find anything, one has to question the value of doing it in the first place."
Miss Marple, Tyco is a prime example of what I posted yesterday, re problems in our economy. It seems like every week or so, a left wing corporation like Tyco finds a billion or so dollars missing in a real audit. Just look at the $ criminal impact of just Tyco this week on the market from the data below:
-- Tyco International Ltd., acknowledging a raft of new accounting problems, took big charges to clean up its books and reported a $468 million loss for its fiscal second quarter.
The huge new accounting charge -- which amounted to $1.1 billion after tax for the quarter.
When this happens and our economy and markets keep moving along, it is a great testimonial to how strong our economy is.
I cannot tell you how gratified I am to see Boies embarassed, and perhaps under suspicion.
Studying Enron, the telecom bustups, etc, from what I can gather, all of the fraud companies apparently used the time-honored real estate MO to artificially inflate earnings and thus grow their companies stock to dizzying heights........that MO is leverage.
Of course in RE you have tangible assets. Here, it was simply the art of the deal and the willingness of banks (notoriously gullible the higher the numbers get), analysts, and brokers to simply believe in fantasy earnings predictions.
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