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Is HP Right? Autonomy Salesperson Shares Internal Emails
Julie188 writes "You know how HP said it uncovered $5 billion worth of 'improper' revenue at Autonomy? One thing HP has accused Autonomy of doing is booking software-as-a-service contracts as software licensing deals. So how might that type of accounting work? A former Autonomy salesperson fighting a legal battle with HP says she's seen it happen firsthand. She's shared internal Autonomy emails and documents that show the details of one deal. '[While working for software company CA, Virginia Briody] had closed a four-year $1.22 million hosting/software-as-a-service deal with a customer, Pioneer Investments, and was paid her full commission, over $100,000, she says. Autonomy bought the software unit from CA on June 9, 2010, and Briody became an employee of Autonomy and Autonomy inherited the Pioneer contract. But there was an issue. Autonomy didn't acquire all the pieces called for in the original contract, Briody says. It didn't have a partnership with the hosting facility and it didn't gain from CA a critical piece of compliance software the customer needed, she says. Autonomy needed to find substitutions or Pioneer would cancel the contract, Briody says. So in the fall of 2010, she signed a new deal with Pioneer and walked away with a four-year, $1.859 million contract of which Autonomy execs considered $1.8 million as new revenue, she says.'"
Not news for nerds, stuff that doesn't matter unless you wear a $1000 suit.
but did they also pay the commission as a whole new sale?
I read TFS. I understood nothing. My nerd days must be over.
Looks like nowadays nerds are those who have deep insight into financial dirt. Forget computers, gadgetry, coding and Science Fiction. Welcome corporatism, financial stuff, sales and so on.
I'm a sad puppy now.
...gis sdrawkcab (usually not responding to ACs; don't bother posting as AC)
Goes to the UK.
HP got suckered. Now they find a salesperson that is so greedy they want even more money. Look who comes along and offers some payout to anyone that can help the HP case.
She says, Briody says, she says, Briody says, she says.... I like how you mixed that up so that it wasn't at all repetitive.
HP got suckered.
Just Desserts... They've been suckering their customers since at least Carly Fiorina...
They used to be a tech research titan, now they sell printer ink.
If you want news from today, you have to come back tomorrow.
They're buying it!
Don't get any on your shoes tho. that'll stink forever.
Keep dragging HP down just like your Governor's campaign. Dumb ass Mattel Barbie CEO, go join Carly in the shithouse where you belong.
I was wondering too. So now, I likely could create a spreadsheet, showing the issue, and how much 'extra' they carried on their books.
Peter Burrows's 2003 biography, "Backfire: Carly Fiorina's High-Stakes Battle for the Soul of Hewlett-Packard," about the former Hewlett-Packard czarina, included background and commentary from Fiorina's first husband, Todd Bartlem. Bartlem comes off as a bitter, wounded, and dare I say truthful commenter on Fiorina's hard-won transformation from world's peppiest receptionist to CEO of a prestigious multinational corporation.
Bartlem describes Fiorina worshiping the book "Dress for Success" like a "Bible," and ditching him without leaving a phone number or forwarding address.
Sad, is it not. I loved working for them several decades ago. Learned about the HP way. But now? The HP way, is long away.
I prefer the "u" in honour as it seems to be missing these days.
And I was just re-reading the H-Dogs mad Midstate posts last night...
Highlight of the evening: S'mores made with the help of Bunsen burners!
Be there! (Or I get your share of marshmallows and chocolate!)
I have been a captive in America my entire life. Everybody and everything uses customary units instead of metric.
Really?
That's because the real HP was renamed Agilent. They left the HP name behind with the dregs.
"National Security is the chief cause of national insecurity." - Celine's First Law
I wonder how many of these contracts would put any material dent in HPs write-offs to date. Several thousand of them methinks...
made a good deal for herself
Tl;Dr
It is sad.
I've always used HP calculators, my dad tought me RPN, and that's all I've ever used. When I was in school in the 80's, I paid $400 for an HP41 built in Corvallis. When the keys stopped working, I carefully opened the case, cleaned the contacts with a little Carbon Tet and put it back together. Where can you buy a decent RPN device today? Nowhere.
I'm not a hardware guy so I don't use HP scopes (do they even still make bench equipment?), but for my current job with the DoD, I insisted they buy me an RPN calculator. The upside is that no one will steal it off my desk because they can't figure out how to use it.
Today, HO sucks, and unless they want to continue down the road that many tech giants have gone - to exist as brand names only on cheap junk - they need to do something quick.
Prediction: Not going to happen.
If you want news from today, you have to come back tomorrow.
"...accused Autonomy of doing is booking software-as-a-service contracts as software licensing deals." then goes on to describe booking a revised deal as a new deal i.e. not what HP accused them of.
The real article of course covers this properly.
"A former Autonomy salesperson fighting a legal battle with HP says she's seen it happen firsthand." the nature of that legal battle is not described, losing the relevance that the legal battle is relation to full commission on the revised deal, despite having been paid commission for the original deal.
I'm not a hardware guy so I don't use HP scopes (do they even still make bench equipment?)
HP's spun off their scientific instruments, electronic test equipment, and a number of things, into Agilent Technologies about 20 years ago. Agilent still makes bench equipment, to the point that I have some pieces of HP/Agilent equipment that are identical except for the corporate logo on them (including having the same model number).
Quote: "One thing HP has accused Autonomy of doing is booking software-as-a-service contracts as software licensing deals."
Booking as the wrong kind of deal WOULD potentially be an underhanded way of recognizing revenue improperly - claiming "We got $120,000 today" when in fact what you really got was an agreement to receive $10,000 a month for 12 months. You didn't really get that cash in hand.
But if you look at TFA, the allegedly "smoking gun" portion of the internal e-mail reads
And the author's summary contains:
If this is the case, there's no fraud here. They're not taking one type of deal (payments over time) and CLAIMING for accounting purposes it as if it was a different type (single up-front payment.). They're actually MAKING a different type of deal - replacing payments over time with a large up-front payment.
Whether this is good customer service (or even breech of contract on the original deal) might be in question. But accounting fraud seems like a stretch - they booked the deal as a "big upfront payment" because the deal WAS a "big upfront payment" after they restructured it.
There's a whole separate animal that neither the e-mails nor TFA really speaks to - if they "double booked" the deal as "new revenue" by re-doing the deal. That might well be fraudulent. But the e-mail doesn't seem to indicate that, and TFA merely puts it as a side note.
It's not really the summary's fault. This is word-for-word from TFA, which is incoherent and poorly written.
Where can you buy a decent RPN device today?
You buy an older HP calculator on eBay of course.
'The tyrant will always find pretext for his tyranny.' - Aesop's Fables
The biggest problem was that HP didn't spin off their Corvallis calculator group to Agilent. HP management never understood the fact that HP calculators were predominantly used by the same technical customers as their other instruments - hence HP-IB, HP-IL calculator interfaces, the huge popularity of their EE software packs, etc - and shouldn't have been left to rot with the office equipment business.
Take HP Loses in Tax Court to IRS and HP Grabs $14.5B Job Creation Tax Break As It Celebrates Layoffs, for instance. :-)
Where can you buy a decent RPN device today? Nowhere.
Well, nowhere except Amazon I guess. Or TigerDirect, or Best Buy, or whatever ... I have one of these and it works great. I don't have cause to do a lot of number-crunching most days anymore, though, and the AAA batteries on it tend to run out even after I haven't been using it, so more often than not I end up using an HP48 emulator on my Android phone. I do like the real buttons on the standalone calculator, though, so if I had more cause to calculate I'd use that.
Breakfast served all day!
If you are under a time pressure, then generally you'll randomly select some specimens from the summary list of income sources (contracts) and send auditors to inspect those specimens in detail. That way you are likely to catch a "bad batch". It's not perfect, but a pretty good way if you can't check them all thoroughly.
I suspect HP only did summary auditing.
The banks should have done depth sampling with their bundled mortgages and perhaps saved the world from a global recession.
Table-ized A.I.
Sure she'd like to get the money, but there's also the issue that if the company is going to book revenue in a particular way they have to deal with ALL of the things that go along with that. Companies paying commission don't get to say on one side "this was a great sale and we're going to compensate our executives on a great sales year" and on the other "that's an ok lease agreement you got, too bad commission on those is so low."
That's worse than the old Dilbert where the secretary "neglected" to put anything between the announcements of miserable numbers and an increased United Way push.
fencepost
just a little off
Booking top line revenue at the time they get wet sigs is standard operating procedure for I don't know how long...30+ yrs.
I like this story - some people want more StarTrek then read StarTrek stories, some people want to know how the IT tech business side is working or not-working, then read this one.. seems good to me. Why are money numbers no good when physics numbers are good ? both intersect the sector...
RPN ("reverse polish notation") is also generically called postfix notation and is differentiated from "polish notation" (prefix notation), and "algebraic notation" (infix notation).
I've used an HP 48G and learned how to use RPN but never understood the point beyond simple arithmetic problems--why am I spending extra work redoing the problem for the stack, entering operations in a different order than the problem shows, rather then entering it from left to right as I see it?
Yeah, okay, there were some interesting things to do with variables and matrices, but I never got really into SysRPL programming after having given up on higher level calculus and linear algebra in five variables.
Obviously they were trying to imitate CA and failed
And that is HOW the fault of Fiorina ??
It is the fault of the HP heirs and the HP board to hire such a muppet. I assume it was all about "gender empowerment" or other Californian lefty, new-age hippy shit. They should have hired of the class of a Larry Ellison.
But fuck, these guys tend to be not on the market.
When I saw "CA" in the text, I knew there must be some shenanigans.
Isn't this the same kind of stuff that got Sanjay Kumar of CA in prison?
Well they can't blame this one on him. He may soon have some new cellmates to talk old times.
Tracy Johnson
Old fashioned text games hosted below:
http://empire.openmpe.com/
BT