The inquiry by chief financial watchdog the Securities & Exchange Commission, follows allegations made in the Washington Post regarding the way AOL booked its advertising revenue.
While it admitted the investigation, AOL Time Warner said all accounting had been done according to generally accepted acounting principles, and denied any wrongdoing.
In its most recent financial statements the company showed a profit of $394m for the second quarter of 2002 compared to a net loss of $734m the previous year for the same time period.
In January, AOL TimeWarner was forced to record a charge of around $60bn (£41bn) in the first quarter of 2002 due to a new accounting rule.
The new US accounting rule on goodwill acquisitions – FAS 142 – effective from 1 January 2002, meant the company had to record the one-off hit following the $350bn merger of AOL and Time Warner.
AOL Time Warner is audited by Ernst & Young LLP.
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