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August 9, 2002 — (WEB HOST INDUSTRY REVIEW) — Bankrupt Telecommunications firm WorldCom said on Thursday that it had uncovered an additional $3.3 billion in accounting errors, bringing the total dollar value of its accounting scandal to more than $7 billion.
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The company also said it may write off $50.6 billion of goodwill and other intangible assets and reevaluate the value of its property, plant and equipment.
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An internal audit by the company discovered that the $3.3 billion in earnings were improperly recorded on its books from 1999 to the first quarter of this year. The $3.3 billion is in addition to the $3.85 billion in expenses the company previously reported that it had improperly booked as long-term capital investments.
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WorldCom says the majority of the $3.3 billion was hidden through the manipulation of reserves, counting them as operating income.
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The company discovered the additional accounting errors while probing its books back as far as 1999. The company?s original accounting scandal brought an investigation by the US Justice Department and fraud charges from the Securities and Exchange Commission.
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Former WorldCom CFO Scott Sullivan and controller David Myers were arrested and let out on bail last week in connection with the scandal.
