Hewlett-Packard ignored warnings about accounting irregularities at Autonomy, and failed to properly vet its finances before acquiring the British software maker, shareholders said in a lawsuit.
Bloomberg reports that Hewlett-Packard board members performed 'no technical due diligence' and the company’s executives and advisers 'misrepresented facts to conceal their own failings', Joseph Cotchett, an attorney for investors, said in a complaint filed yesterday in federal court in San Francisco.
Autonomy engaged in 'round trip transactions', in which it bought goods from its customers, and engaged in other forms of aggressive revenue recognition to inflate its financial health, according to the complaint.
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image: © Lisamarie Babik