After a yearlong internal audit and SEC probe, Dell yesterday refiled financial statements that blamed methods of recording software and warranty sales on a $92 million profit reduction from 2003 to the first quarter of this year, the Wall Street Journal reports. The reduction was about 1% of the Texas-based company's $12 billion net income for the period.
Independent accounting firm Pricewaterhouse said Dell’s poor oversight resulted in “inappropriate accounting decisions" that inflated software and warranty revenue. Dell also recorded vendor funding as expense reductions instead of a reduction in cost of goods sold. Dell’s restated filing included a $105 million cut in software revenue for 2005. The company is cooperating with SEC and Justice Department investigations.