SEC probes Elan's accounting policies
Elan, until this month Ireland's most valuable company, is facing an investigation by the US Securities & Exchange Commission, over its accounting practices.
Following a profits warning in January, news emerged that the public company was using special purpose vehicles to inflate its profits – accounting policies similar to those that brought down Enron, the US energy giant.
Commenting on the investigation, announced last Thursday, the company said it welcomed ‘the opportunity to resolve all matters raised by the SEC in light of recent allegations made against the company in the media and in shareholder lawsuits’.
Elan is facing a class action filed in the US by angry shareholders alleging the company’s profits had been artificially inflated. Elan shares trade on the New York, London and Dublin stock exchanges.
Its share opened at £1.04 in London today up 9.9% from a fall of 5% to 927p on Friday.