IBM Under Accounting Investigation For Transactions in US, UK, and Ireland
IBM admits United States Securities and Exchange Commission has been probing company practices since August
IBM is under investigation by the United States Securities and Exchange Commission (SEC) for potentially dodgy accounting practices in regards to its transaction in the US and the UK.
“In August 2015, IBM learned that the SEC is conducting an investigation relating to revenue recognition with respect to the accounting treatment of certain transactions in the US, UK, and Ireland,” said IBM in its latest quarterly financial filing.
IBM has released no specific details about the investigation, but claims it has been cooperating with the SEC since August.
Rigorous
“IBM has a rigorous and disciplined process for the preparation of its financial statements and the reporting of revenue,” the company told TechWeekEurope. “We are confident that the results and information we report have been appropriate and consistent with GAAP (Generally Accepted Accounting Principles).”
Earlier this month, IBM announced its 14th consecutive quarter of declining revenues and cut its full-year operating profit forecast.
The company attributed the revenue loss largely to a broad shift away from packaged software products to the cloud and, in the storage industry, a shift to cloud-based storage and to the flash memory typically used in mobile devices, and increasingly also in servers and laptops.
IBM attributed about 9 percent of the decline in overall revenues to a strong US dollar, a factor that has boosted recent results from European companies such as SAP.
