TechnologyErrors at Ariba date back to 1999

Errors at Ariba date back to 1999

E-procurement software firm Ariba has adjusted all but one of its financial statements as far back as 1999, following a review of its accounting which it begun in January.

Link: AstraZeneca aims for £600m e-procurement saving

The company cited accounting errors, questionable executive perks, and dubious partner deals as the cause of the restatements.

The restatement has increased Ariba’s deficit at December 31, 2002 by $3.8m to $4.24bn.

Ariba said it has been in communication with Nasdaq and expects to be in compliance with its continued listing requirements upon filing forms for the quarters ended March 31 and June 30, 2002.

A raft of issues were behind the adjustments.

These included a payment made by Ariba chairman Keith Krach to ex-president and chief executive Larry Mueller, which is now considered capital contribution rather than personal.

Other issues included expense adjustments on payroll taxes, royalties, litigation, bonuses and benefits, and income taxes.

Adjustments were also made on three software licensing deals, which Ariba now says came about ‘at or about the same time the company incurred obligations to purchase goods or services from those vendors’.

A statement from the company revealed an increase in net loss of $9.8m for fiscal year 2000 and $14.1m in fiscal 2001. In the first quarter of fiscal 2003 net loss increased by $2m. But in fiscal 2002 net loss decreased by $22.1m.

The company noted ‘none of these adjustments has any impact on the company’s cash balances for any period’.

Ariba is also the subject of a Securities and Exchange Commission probe into the restatements but the firm provided no update on that investigation.

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