Citing "serious accounting improprieties," Hewlett-Packard is taking an $8.8 billion charge on its 2011 acquisition of software firm Autonomy, the company announced on Tuesday.
“HP is extremely disappointed to find that some former members of Autonomy’s management team used accounting improprieties, misrepresentations and disclosure failures to inflate the underlying financial metrics of the company, prior to Autonomy’s acquisition by HP," reads a statement from the company. "These efforts appear to have been a willful effort to mislead investors and potential buyers, and severely impacted HP management’s ability to fairly value Autonomy at the time of the deal. We remain 100% committed to Autonomy and its industry-leading technology."
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An internal probe by HP in tandem with PricewaterhouseCoopers found that $5 billion of the charge was related to alleged accounting improprieties. The rest was brought on by "recent trading value of HP stock and headwinds against anticipated synergies and marketplace performance." HP is referring the matter to the U.S. Securities and Exchange Commission’s Enforcement Division and the UK’s Serious Fraud Office for civil and criminal investigation.
The charge came as HP reported revenues dropped by 7% year-over-year in the fourth-quarter to $30 billion. For the full fiscal year, which ended on Oct. 31, HP's revenues fell 5% to $120.4 billion.
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HP's stock was down more than 10% in premarket trading on the news.
The company purchased Autonomy for $10 billion during a transition from outgoing CEO Mark Hurd to incoming CEO Leo Apotheker.
A month after the purchase, Apotheker was replaced by Meg Whitman, the former CEO of eBay. Under Whitman, HP has restructured, cutting 29,000 jobs in an attempt to become a leaner and more profitable company. Wall Street has been impatient with the turnaround, pushing HP's stock price to its lowest level in nine years.
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The HP SpectreOne
While HP is known for its TouchSmart line of devices, the SpectreOne is not a touchscreen. At just 11.5-mm thin, however, it is the company's slimmest all-in-one PC. It also features a 23.6-inch flush-glass full HD display and a curved back. The SpectreOne expected to be available across the U.S. in November, with a starting price of $1,299.
This story originally published on Mashable here.