HP takes $US8.8 billion charge on Autonomy accounting improprieties
- 20 November, 2012 14:21
- Comments
Hewlett-Packard is taking an $US8.8 billion charge as a result of what it called serious accounting improprieties that occurred at UK software company, Autonomy, before it acquired the firm in 2011.
Taking the charge into account, HP suffered a $US6.9 billion loss in the fourth quarter. HP CEO, Meg Whitman, said that Autonomy misled HP about the state of its business before the acquisition.
HP has notified authorities and will help criminal investigations, Whitman said.
HP bought Autonomy for its enterprise search engine technology, among other things.
- The majority of the impairment charge resulting from the Autonomy acquisition was "linked to serious accounting improprieties, disclosure failures and outright misrepresentations at Autonomy Corporation plc that occurred prior to HP's acquisition of Autonomy," Whitman said on the conference call.
- "These improprieties were discovered through an internal investigation after a senior member of the Autonomy leadership team came forward following the departure of (former Autonomy CEO Mike Lynch) on May 23rd," Whitman said.
- "Based on this information HP initiated an intense internal investigation including a third-party forensic review of Autonomy's historical financial results. HP has contacted the SEC's enforcement division and the U.K. Serious Fraud Office. We have requested that both agencies open civil and criminal investigations into this matter," Whitman said, adding that "HP intends to seek redress against various parties in the appropriate civil courts."
For the fourth quarter, HP's net revenue dropped 7 per cent to $US30 billion as the company's PC market share declined and printer sales dropped. Analysts had expected the company to generate $US30.43 billion in sales, according to a Thomson Reuters poll.
- Several major HP business areas suffered a decline in the fourth quarter. Services revenue dropped 6 per cent year over year. Enterprise servers, storage and networking revenue declined 9 per cent year over year.
- One bright spot was software revenue, which increased 14 per cent year over year with a solid 27.2 per cent operating margin. Networking revenue was up, by 7 per cent.
Recommended
Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.
- Bookmark this page
- Share this article
- Got more on this story? Email CIO
- Follow CIO on twitter
-
Why change management doesn’t work
-
Larry Page wants to see your medical records
-
Dual-Persona Smartphones Not a BYOD Panacea
-
After two-year hiatus, EFF accepts bitcoin donations again
-
CIOs struggle to deliver timely mobile business apps: survey
-
Six Reasons to Empower Your SharePoint Citizen Developers
More and more business applications are being created by “citizen developers” - end users who are not IT developers but who create solutions for themselves and their groups. This white paper explores six reasons to embrace citizen development in an intelligent way that minimises risks and maximises the return on your SharePoint investment. Read now. -
Endpoint Security and Virtualisation
Besides form factor, virtual systems are not really that different than physical systems. They both use the same operating systems and applications. They both present users with computing resources such as RAM and hard drives. Consequently, the ability to exploit vulnerabilities in a physical environment will present a significant threat to virtualised environments as well. This paper examines the different endpoint security methods for virtualised environments and presents how Endpoint Protection security provides optimal performance, protection and manageability. -
Unleashing the Power of Information
If business-relevant information is not well managed, secured and analysed, it can become an underutilized asset or—worst case—a legal and competitive liability. Nearly all of the IT and business executives who responded to a recent survey recognise this risk, and say they understand the importance of having an enterprise information management (EIM) strategy. Find out more on how to reduce costs, improve competitiveness and avoid risk by making information management an enterprisewide strategic priority.
Get exclusive access to Invitation only events CIO, reports & analysis. 
