Dell shareholders to consider SEC settlement
by AccountingWEB on
Dell Inc. appears to be closer to an agreement with the U.S. Securities and Exchange Commission, which has been investigating the computer maker and its founder over questionable arrangements with Intel.
Dell disclosed in June that the company and its chief executive, Michael Dell, proposed settlements to the SEC staff. The settlements relate to “violations of securities laws relating to certain accounting and financial reporting matters.” The company set aside $100 million in June as part of the potential settlement, which reportedly also includes the provision that Dell continue to serve as chief executive, according to a report by The Wall Street Journal.
Dell Inc. held its annual meeting July 16, but it adjourned in less than an hour, and will reconvene Aug. 12 to give shareholders time to consider information from the investigation into rebates Dell received from Intel and the related settlement talks, The Wall Street Journal reported. Any agreement would have to be approved by the SEC and a U.S. District Court.
The SEC investigation has led to Dell restating four years of earnings. Dell conducted its own probe and found in 2007 that employees misled auditors and adjusted numbers to meet growth targets. It found that sales had been overstated by $359 million and income by $92 million, an Associated Press report stated. Its chief financial officer was replaced.
In a separate matter, Dell last year agreed to settle a shareholder class-action lawsuit for $40 million over its accounting practices and other issues.
New York Attorney General Andrew Cuomo also is looking at the relationship between Dell and Intel. He has filed a lawsuit against Intel, accusing the chip maker of using rebates and co-marketing arrangements as bribes to persuade Dell and others to use its products rather than lower-cost chips, the Silicon Valley/ San Jose Business Journal reported.