SEC is investigating revenue recognition abuses

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16 May 2002

Although there is not yet any information on the website of the US SEC, today's Wall Street Journal is reporting that "Securities and Exchange Commission officials, concerned about an explosion of transactions that falsely created the impression of booming business across a range of industries, are conducting a sweeping investigation into a host of practices that pump up revenue." In some cases, profit is recognised as well.

Examples include swaps of energy and fibre optic capacity, barter transactions, channel stuffing, and vendor financing, allowances, and rebates.

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