SEC Formally Investigates IBM

glhturbo writes "IBM announced Thursday that it had received notice of a formal, nonpublic investigation by the Securities and Exchange Commission (SEC) concerning the company's disclosures relating to Q1 2005 earnings and expensing of equity compensation. According to the article, there has been a non-formal investigation going on since June 2005. Both articles indicate that it doesn't mean IBM has broken any laws, so we'll see what comes of it."

Comments

Re:Do other industries get as much attention?

[Schraegstrichpunkt]

Now, of course the honest thing to do is to give them both the same numbers

Not necessarily, IIRC. Especially when determining the value/depreciation of assets, some firms apparently keep different sets of books: one set that is legally required for government agencies, and a different set that the firm believes is more useful for making decisions. I don't see anything wrong with this in itself, but it can obviously get you into trouble if you start reporting to the government from the wrong set of books.

At least, that's what my accounting teacher said way back when I was in high school. YMMV.