Dell has delay filing its quarterly earnings report with the U.S. Securities and Exchange Commission ( SEC ) and may have to repeat past earnings statements , the troupe said Monday .
Dell ’s board of directors began an internal fiscal audit after learning in August 2005 that the SEC had begun an investigation of the company ’s revenue recognition and accounting practices for past fiscal year , Dell executives acknowledge Aug. 17 while announcing preliminary results for the 2nd quarter .
Since then , Dell learned of a 2d investigating when the U.S. Attorney for the Southern District of New York subpoenaed the company ’s financial coverage documents for the year from 2002 through today , say Dell spokesman TR Reid .
Neither the SEC nor New York State has declare the consequence of their investigations , but Dell ’s inner audit has now revealed that the company may have misstated anterior financial reports , including accumulation , reserves and other balance sheet item . Until it settle those questions , the company can not file its SEC Form 10 - Q , which confirms its quarterly results , Reid say .
Those preliminary results were sorry even before Monday ’s newsworthiness . Dell earned only US$ 502 million in net income for the 2nd one-fourth of 2006 , a drop of 51 percent below that full stop last year . The descent was a casualty of cutting prices in a slow market , Dell Chief Executive Officer Kevin Rollins separate analyst in August .
Dell , the world ’s large PC vendor , has felt up increasing free-enterprise air pressure from Hewlett - Packard at the same clock time chip makers like Intel have been cutting prices on central processing unit , avail to drive down PC cost .
And on Aug. 14 , Dell announce the largest recollection of consumer electronics in U.S. account , recalling 4.1 million notebook computer battery that suffered from a defect get them to overheat and sometimes catch fire .
Dell is cooperating with both investigations and “ will take any appropriate remedial or corrective actions to come up to any trouble , ” company chairman and beginner Michael Dell said in a release . The society has also suspend its share repurchasing programme and a get together with analyst scheduled for Sept. 13 .
