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Dell Delays Quarterly Filing
By Jessica Davis -- Electronic News, 9/11/2006
Dell Inc. today said it would delay the filing of its Form 10-Q report for Q2 with the U.S. Securities and Exchange Commission due to “questions raised in connection with the previously announced informal investigation by the (SEC].”
Dell said that the informal SEC investigation and its own internal investigation have indicated the possibility of misstatements in prior financial periods including issues related to accruals, reserves and other balance sheet items that may affect previously reported financial results. Dell said it will file its Form 10-Q as soon as possible, but did not give any indication as to when that might be.
The delay and investigations are only the most recent in a series of problems for the PC giant, which had to recall millions of laptops last month because of faulty batteries that pose a fire risk.
The company is working with the Audit Committee and with the company's independent auditors to determine if any restatements of prior period financial reports will be necessary.
"We have not yet reached any conclusion on materiality as to these issues," said Don Carty, chairman of the Audit Committee reviewing the matter, in a statement. "We are continuing to investigate the matter fully," Carty added.
Dell said that the U.S. Attorney for the Southern District of New York has initiated its own investigation of the company, subpoenaing documents related to the company's financial reporting from 2002 to the present.
"We are fully cooperating with the investigations and working to resolve any and all issues raised in connection with those investigations as quickly as possible, and we will take any appropriate remedial or corrective actions to address any problems," Chairman Michael Dell said, in a statement.
Dell has suspended its ongoing share repurchase program until further notice. In addition, given the delay in its 10-Q filing, the company has postponed the meeting with analysts that was to be held on Wednesday, September 13 and will reschedule it to a later date.
