Last week the Securities and Exchange Commission settled with Austal, a Mobile Alabama-based navy shipbuilder, over fraudulent revenue recognition charges for $24 million.
“Transparency is a hallmark of financial reporting, and investors rely on companies to accurately and fairly represent their financial condition so that they can make informed decisions,” said Jason Burt, Director of the SEC’s Denver Regional Office. “The terms of this settlement make it clear that when companies manipulate their financial results to avoid falling short of analyst expectations – and those actions harm U.S. investors – the SEC will hold those companies accountable, wherever they are located.”
Aoccording to the complaint Austal artifically reduced cost estimates between January 2013 and July 2016 despite costs actually rising, allowing the company to inflate EBITDA beyond analysts expectations.
Austal’s fromer president, Craig Perciavalle, former director of financial analysis, Joseph Runkel and former director of the Littoral Combat Ships program, William Adams are currently under litigation by the SEC for accounting fraud.
By Staff
