U.S. News

Dell Finds Evidence of Misconduct in Finance Probe


Dellsaid on Thursday an internal audit of its accounting found evidence of misconduct, errors and deficiencies in its financial controls, sending its shares down 6 percent.

The world's second-largest personal computer maker said it is working with its auditors and management to determine whether restatements of past financial statements are needed, and to see if the control deficiencies "constitute a material weakness" in its internal control over financial reporting.

Dell announced last August that it had been investigating its accounting for a year. Later in 2006, the company said the U.S. Securities and Exchange Commission and U.S. federal prosecutors were investigating its past accounting.

Founder Michael Dell in January retook the helm of the company from Kevin Rollins, who left after the investigations were disclosed and a series of lower-than-forecast financial results. The company last year lost the No. 1 PC market share ranking to rival Hewlett-Packard .

Dell said on Thursday the accounting review meant it would not file its annual report with securities regulators by the April 3 due date, or by an extension date of April 18.

The stock, which had closed up 0.2 percent at $23.39 in regular-session trading on Nasdaq, fell almost 7% in after-hours trading.