Autonomy Founder Fights Back Against Book-Cooking Charges
Autonomy founder Mike Lynch has decided again to attack the Hewlett-Packard Co. (NYSE: HPQ) accusation that his big data company cooked its books before the U.S. public corporation bought it. At issue, among other things, is how revenue was accounted for and perhaps inflated. Lynch has good reason to take a public position. He could lose all the money he made on the transaction, and even be prosecuted for fraud.
One of his suggestions makes a great deal of sense. He wants HP to show the public what its investigation has revealed. That would allow a much broader group than HP's accountants and board to see the case against Autonomy, and perhaps judge the extent to which the U.S. firm bungled its evaluation. In his letter, Lynch wrote:
In order to justify a $5 billion accounting write down, a significant amount of revenue must be involved. Please explain how such issues could possibly have gone undetected during the extensive acquisition due diligence process and HP's financial oversight of Autonomy for a year from acquisition until October 2012.
Very good point.
Douglas A. McIntyre
Filed under: 24/7 Wall St. Wire, Mergers and Buy Outs, Technology Companies Tagged: HPQ