Wanted: Reliable Abacus for Nortel Accountants

Nortel Networks has discovered that even more of its past revenue was reported prematurely than originally thought when it announced yet another restatement of its financial reports about a month ago according to reports today in the Canadian press.

The telecom-equipment vendor, which has been bogged down in accounting problems for more than two years, said additional problems were uncovered as part of the restatement process announced March 10.

Nortel’s accounting problems have resulted in regulatory and criminal investigations, the firing of several top executives including former chief executive Frank Dunn, and damaged the technology company’s reputation in financial circles.

Nortel said it has determined that the accounting standard it is now applying “requires an analysis of individual contract deliverables such as hardware, software and/or services and their fair value in order to determine the time pattern of revenue recognition.” That is different than the previous accounting method the company used which relied on estimates based on percentage of work completed.

The company added that as a result of this work, additional revenue recognised in prior periods — beyond what was expected a month ago — will be restated and deferred to future periods.

“The company will be in a position to determine the amounts of additional revenue deferral and periods impacted upon completion of this work.”

The following two tabs change content below.

admin

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Nam dignissim magna vitae dui posuere eu feugiat augue eleifend. Fusce sed tincidunt quam. Donec varius aliquam metus ut semper. Donec augue purus, feugiat interdum malesuada vel, aliquet quis massa. Nulla facilisi. Nam vel ante quam, et tincidunt dui. Maecenas venenatis libero eu nulla tincidunt et accumsan velit sodales. Nam congue mauris et felis porttitor blandit. Nam eget tempor massa. Nullam suscipit gravida eros, ac suscipit magna feugiat sit amet.

Latest posts by admin (see all)