Halliburton Responds to Larry Klayman's Supersillyous Suit(My Title)

CBS Market Watch "Big Charts" Web Site ^ | 7/10/2002 | MarketWatch.com

[SierraWasp]

12:57PM Halliburton responds to Judicial Watch lawsuit (HAL) by Michael Baron Halliburton (HAL) is off 30 cents, or 2.1 percent, to $13.82, in midday action. The company is out with a press release responding to a lawsuit filed by Judicial Watch, a Washington, D.C.-based legal watchdog group. The suit alleges fraudulent accounting practices at Halliburton took place during the period when current vice president Dick Cheney served as its chairman and CEO. Halliburton called the claims in the suit, "untrue, unsupported, and unfounded." The company continued: "We are working diligently with the SEC to resolve its questions regarding the company's accounting procedures. Halliburton has always followed and will continue to follow guidelines established by the SEC and GAAP, General Accepted Accounting Principles."

[Texasforever]

Of course they are quantified. Halliburton is at peril if it allows change notices to go un-counted and booked as receivables. Halliburton spends REAL money and builds REAL things. It is not a "stock" driven company in the same way as Enron or a vapor-service scam. Halliburton cannot create profits; it can only build real things at a profit. If Halliburton does not win major projects there is NO way to make it look as if it did and hide it from the shareholders. I guess the simple answer is that if you build houses there is no way to claim you have the money from houses that you did not build. There are about 10 major firms like Halliburton worldwide fighting tooth and nail for about 100 major petro-chemical projects worldwide per year. The success of that effort is what drives stock prices NOT accounting tricks.

[Fledermaus]

I think Mary Matlin should be shot. How dare she actually give birth to Carville's demon seeds?

[Texasforever]

Does Halliburton every take drilling proceeds or contracts as payment?

Halliburton does not drill for oil( unless they have recently started) as such. It provides equipment and in some cases contract crews but that is on a service contract usually on a simple time and materials basis. Halliburton is far more likely to have designed and built the drilling platform itself.

[Torie]

Well then this brouhaha should have a short half life if you are right, maybe not with the usual suspects, but with those with adjudicatory authority. You are positing that absolutely nothing is there; Halliburton simply decided to add up and book its change orders signed off by the client for work previously performed prior to collecting the cash. That would be a real snoozer. I suspect maybe some of those change orders might not have been signed off on, but Halliburton thought were meritorious. That is just a wild guess.

[isthisnickcool]

Well done, thou good and faithful Ross impersonator! Encore!!!

Thank yew!

Ross

[Texasforever]

Does Halliburton every take drilling proceeds or contracts as payment?

I completely misread your question. I am sure they may have at some time done that. I do know that Halliburton has taken equity positions in petro-chemical plants when the client has had trouble gaining financing on his own.

[Texasforever]

There are change orders that are challenged yes. It is usually because the client interprets the increase as engineering error and Halliburton interprets it as client error. That was not a frequent happening and usually absorbed by Halliburton to avoid alienating important clients. I am not saying that Halliburton may have some dirty hands. However I don’t believe the dirty hands is in accounting practices. The large scandals in EPC have always been with procurement and procurement mangers’ inside deals with vendors. Those when found are dealt with harshly by the company OR the client that is buying the equipment through the company.

[Torie]

So in your experience do companies book as revenue change orders issued by the company for work already performed that have not been yet acceded to by the client (I assume challenged ones are not)? That my friend is the question.

[nunya bidness]

That would make sense. If the client is borrowing against a future windfall and he can't make payment then the proceeds could be offered as payment. Of course I'm not talking about already oil rich clients but more in the small speculative markets.

The wrinkle will be when these small markets are in regions that come and go in favor of the US.

I don't doubt that these contracts are collected and sold as quickly as possible as political climates change with the wind.

Thanks for the info.

[Texasforever]

One more point and maybe the most important. Each project is executed by a task force that is completely self-contained. Each Task force has a full compliment of client personnel that have access to every facet of the project being built. They do their own audits, engineering, procurement, construction and ESPECIALLY cost control. They never have their eyes off the budget.

[Texasforever]

So in your experience do companies book as revenue change orders issued by the company for work already performed that have not been yet acceded to by the client (I assume challenged ones are not)? That my friend is the question.

Challenged change notices are almost always absorbed by the contractor for the reasons I stated, the amounts are usually not significant enough to warrant jeopardizing return business in such a small universe of big clients. In those cases the change notice is simply filed for whatever tax write offs that could accrue as losses.

[Texasforever]

Halliburton and companies like it have literally developed the 3rd world and very little of that has to do with oil. It is in fertilizer plants, chemical plants, herbicide plants, LNG plants and terminals, dams, highways, even towns. and on and on. Almost all are financed by the IMF or World Bank through the governments of these countries.

Yes it is a risky business but it is also a very lucrative business. The irony is that oil related projects are only about 20% of Halliburton’s market.

[nunya bidness]

Thanks again. I learn something new every day.

[TLBSHOW]

Can you get me a link to that story about Larry and his forgetful mind. I want to post it on as many political web sites as I can.

[Texasforever]

So in your experience do companies book as revenue change orders issued by the company for work already performed that have not been yet acceded to by the client

Sorry I completely overlooked the simple question. In my experience the simple answer is no, at least with Halliburton. I have been very verbose because for once I can add some substantive input into a subject I am intimately familiar with and I had to at least have a working knowledge of the legal constraints of the contracts I operated under. I am not however claiming that I know the legal areas that could be argued or how they would be decided in court. I do know though that Larry has no clue either. Hell I may end up in jail too. LOL

[Howlin]

Right here

[Clara Lou]

Thanks, for posting the transcript, Howlin. I'm so outraged by Larry's comments that I don't know where to begin. I do see that Miss Know-it-all got some of her talking points from him.

[deport]

I do see that Miss Know-it-all got some of her talking points from him.

LOL.... My guess is they all come from the watch or her buds she talks to over at the watch.

[Mo1]

I do see that Miss Know-it-all got some of her talking points from him

And notice how she scoots out when she doesn't have any more index cards to read from

[woofie]

This cant be the end...can it?