By Graham Hayday, 2 July 2002 08:40
NEWS KPMG is being dragged further into the Xerox mire following the document management company's embarrassing admissions over its financial situation. Xerox has said that it improperly booked $6.4bn in revenue and overstated pretax profits by $1.4bn between 1997 and 2001, during which time its accounts were scrutinised by KPMG. It is now audited by PricewaterhouseCoopers, which was instrumental in bringing the scandal to light. The Securities and Exchange Commission is likely to take a close look at KPMG's part in the story. Harvey Pitt, the organisation's chairman, said on US TV earlier in the week that the spotlight will now fall on the corporate executives, directors and accountants involved in the improper bookkeeping, telling ABC This Week: "Before much longer, we're going to make all of them responsible for what they've done... [The SEC] is not finished with the Xerox case." But KPMG remains defiant. It says that PwC and Xerox have got it wrong, and that the restatements "defy economic reality".
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