L&H publishes report over accounts hole

The investigation was launched in August 2000 after US newspapers reported discrepancies in the Korean subsidiary.

The inquiry into £100m of ‘missing’ revenue found L&H Korea had misrepresented its actual revenues and available cash position on the balance sheet through license agreements with customers and banks. The arrangements gave the impression of valid license agreements being sold to businesses.

L&H admitted the agreements were arranged in response to ‘unrealistic budget’ targets and said it appears unlikely that any of the agreements, many of which were with small businesses, would have delivered within a reasonable time.

L&H’s new chief executive officer, Philippe Bodson, said the company would take legal action against Joo Chul Seo, the Korean subsidiary’s head.

Bodson added L&H may also file suit against Korean banks and others it suspects of being involved in the scam.

Separately, L&H’s auditor KPMG filed civil proceedings in Belgium on Friday against those who allegedly obstructed its efforts to audit the beleaguered software company, Retuers has reported.

KPMG claims it was given false, inaccurate or incomplete information’ and that it was not informed of the so-called ‘side agreements’ designed to bail out L&H.


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