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Tech boss gives his side of HP story

posted 22 Nov 2012, 11:16 by Mpelembe   [ updated 22 Nov 2012, 11:16 ]

Reuters Business Video Report - There's no sign of the accounting storm at Hewlett-Packard blowing itself out any time soon.

The founder of Autonomy has gone on the attack over allegations of accounting improprieties at his British software firm.

It was acquired by the computer giant last year for $11.1bln.

And Mike Lynch said it was always clear about its accounting

Mike Lynch, Autonomy founder, 

"What's happened here is that we have a situation where we ran the business - it was audited by Deloitte quarterly - and now Deloitte has said it went through the books and they were fine. What's happened since though is that the business has been very badly mis-managed, much of the talent has left and that's left to the business being written down and now what you have got is the position where people are looking for scapegoats - they don't want to own up to the fact that in a year they have actually destroyed value that was created over 10 years."

15 different financial, legal and accounting firms were involved in the transaction and none raised a flag about what HP said was a major accounting fraud.

 Mike Lynch, Autonomy founder, 

"The strange thing about this is that it's been handled in the most bizarre manner and the first I knew about it was a press release yesterday. No-one has contacted me fromHP or anyone like that. The last time I had any dealings with HP was in June and suddenly there's this all out PR campaign, Meg's on the television everywhere. It happens to be on the same day that they're also putting out some of the worst results in the company's history. So what we've got here is a situation where the normal process where you'd be warned and given the chance to understand. At the moment we're only just getting to see what they're saying. They're only saying the vaguest things. I've had a day to look at that and start to see it and all that does is reinforce that there's absolutely nothing here."

HP stunned Wall Street with their allegations about Autonomy and took an $8.8bln writedown in its latest results.

Its shares plunged to a 10-year-low.

Financial authorities are now investigating - they're expected to spend months if not years looking into the allegations.