Autonomy misled HP about finances, Hewlett Packard says
bbc.co.ukI worked for a company that was Acquired by Autonomy. They made us fire a large portion of our staff before the final papers were signed so that they could continue with their claims that they never fired people as the result of an acquisition.
Slimy Bastards if you ask me. This does not surprise me in the least.
It doesn't sound like your old company was all that principled either...
Wasn't Autonomy a public company when HP acquired it ? Was it not the responsibility of HP board and management and their investment bankers to do due diligence before they made such a big acquisition ?
Could it be that HP management , having lost the position of largest PC maker to Lenovo, is looking to throw our attention away from their incompetence.
Further along these lines, as a publicly traded company, isn't any cooking of the books a criminal act, regardless of the HP/sale angle?
I agree. This story is quite hard to believe... Nobody spends $12bn without looking carefully into the books. There always is a long and thorough Due Diligence process on transactions like this one. Investment bankers, lawyers and accountants get get their fees mainly for going through every single document in the company...
Apparently Deloitte was supposed to do this, with KPMG as a safety net. It took a third (and also expensive) consulting firm (PwC) to notice issues.
I wonder if there will be any client fallout at either Deloitte or KPMG for this. Probably not...
Maybe HP is just trying to blame it on them? Who knows!
"We did a whole host of due diligence but when you're lied to, it's hard to find," Are you kidding me? That's the whole purpose of doing due diligence in the first place.
The purpose of due diligence is to uncover mistakes and ensure that the books are in order, not to uncover fraud or wrongdoing.
I have a hard time grasping this. If the books are in order, I wouldn't expect to later find significant fraud affecting the books. For example, if the books show $x in orders pending, I'd sample the orders to verify within some confidence level that the lot is worth $x.
And one of the mistakes you should be looking for is the possibility that you are being lied to so thoroughly that it's hard to know what's real and what isn't. It's in situations like that, that forensic accountants earn their salt.
And even if they don't earn their salt, your lawyers should protect you in the representations and warranties section of the definitive agreement.
> Autonomy founder Mike Lynch is a non-executive director of the BBC.
Way to go journalistic impartiality at the BBC.
There could be a technical concern here, but practically speaking the BBC is so impartial it will happily half-destroy itself in the name of journalism.
Their own Director-General just had to resign after a grilling by BBC journalists on BBC programmes. If they'll do that to their own boss, some guy from Autonomy has 0 chance of special treatment.
Extremely well put.
If they hadn't disclosed that information, then I would see it as a problem.
They only disclose it because they have to. What interests me is, what exactly is he doing with the BBC?
Let's travel back in time to a few days ago, before these allegations emerged. Mike Lynch seemed like a guy who'd founded a high tech software company, let it grow, and sold it for billions of dollars. He's got an engineering PhD from a top university.
Over the last 10 years technology like the web, podcasts, home broadband, iPlayer etc have had a lot of impact on the BBC. It makes sense to have someone on the board who has an engineering background and experience managing complex technology projects.
Their press release from 6 years ago: http://www.bbc.co.uk/pressoffice/pressreleases/stories/2006/...
They seem to have a wide range of people from different backgrounds and industries. It's a non executive role, so I assume it's more for 'experience and wisdom' in their respective fields and expertise than anything else.
> It's a non executive role, so I assume it's more for 'experience and wisdom' in their respective fields and expertise than anything else.
He's clearly there to wield influence. What other possible reason?
If he was there to wield influence, he's not done very well this time - otherwise why would the BBC report on possible foul play by his former company? Why would they explicitly mention his connection with the BBC?
> If he was there to wield influence, he's not done very well this time - otherwise why would the BBC report on possible foul play by his former company
Well it such a big story now, they can hardly not run with it can they?
> Why would they explicitly mention his connection with the BBC?
Again, because they have to. I find it fascinating that private industry leaders would be involved, non-executive or otherwise, in the running of a state broadcasting company. The BBC is spending British taxpayer's money after all. Does not seem impartial.
> The BBC is spending British taxpayer's money after all.
There used to be funding from the Foreign Office for BBC World Service, but that has now ended. There's a tiny payment from Department of Work and Pensions to cover the discount for people over 70.
What other tax-payer money is used for the BBC?
> What other tax-payer money is used for the BBC?
License fee.
How is the licence fee a tax?
Watching any live TV in the UK, even when avoiding all BBC channels, is subject to this mandatory payment. Hence it is, by any reasonable definition, a tax.
So it's a voluntary charge, payable by anyone who receives live tv in the UK? Collected by Capita, and paid to the BBC but not to the government?
Call it tax-like, but it is not a tax, and mistaken terminology is unhelpful when campaigning to change the licence fee.
In that sense VAT is also a voluntary charge. You can avoid it by eating nothing.
Lots of food is VAT free or zero rated.
The real difference between VAT and the TV licence is that VAT goes to the government via the Inland Revenue (?), while the TV licence goes to the BBC via Capita. Because it doesn't go to the government it's not a tax. I've already said it's tax-like.
This surely will hurt the reputation of Lynch. The other news reports have quotes saying in effect this was perpetrated by senior management and that the whistleblower who came forward is still at HP/Autonomy, which by inference seems to point a rather stern finger at Lynch.
I have no comment on Autonomy's finances. We did however evaluate it's product vs Google's search appliance.
The Google Appliance we pretty much plugged in and let it do it's thing. After a few days it was giving excellent results on our massive (80,000 people) company intranet.
The Autonomy server had to be constantly tweaked and fiddled with to even get it near to the relevance of the results.
Unfortunately, Autonomy had flogged a loads of licenses to another part of the business for peanuts, so we had to go with their inferior product.