GE warned over accounting practices

The US Securities and Exchange Commission (SEC) has issued a warning to General Electric (GE) over certain elements of its accounting practices.

According to a report in The Daily Telegraph, the SEC has issued a 'Wells notice' against the company, inferring it has the potential to bring 'a civil injunctive action against GE for possible violations of the securities laws'.

The investigation is said to focus on the manner in which GE has accounted for how it has hedged interest rate risk in relation to derivatives.

In addition, the way the company has previously presented its cash flows and recognised revenues is also under the SEC microscope.

GE has confirmed receipt of the written notice, and disagrees with the SEC's issuing of the Wells notice.