HP's Thanksgiving Treat: Stuffed Lynch with all the trimmings

Is it a co-incidence that HP decided to put the boot in to the British software industry just before Thanksgiving? They couldn’t do it for the 4th July (no earnings call until August), so timing it around giving thanks for surviving a year away from the UK is almost as good.

I’ve worked for several US companies where “Rev Rec” has been the principal occupation of most of the accounting staff and a fair swathe of the legal team. The selling to the customer was never as difficult to selling to the accountants.

I’m not complaining. The rules are there to allow outsiders to fairly view the state of the company.

I have chuntered on elsewhere (here and here) about what the rules are and about how you would go about trying to detect the monumental deceit that is alleged.   You can’t help feeling that someone, be it a corporate executive, a lawyer or please God no, an accountant, is likely to end up with a sizable amount of egg on face after this.  If it is a professional adviser that is at fault, even in these days of LLP’s, you have to ask whether anyone carries $5.5billion of professional indemnity insurance, and what size of firm could survive the cost?

It also goes to prove another point that I have made over and over again:  It’s the CEO who end up in the dock.

Mike Lynch is strenuously denying what is alleged against him.  Whilst you would not expect him in any event to put his hands up and yell fair cop at this stage, it is entirely plausible that if there has been wrongdoing, he knew nothing about it.  It could have been an attempt not to manipulate top-line revenue, but to get paid commission, which is usually linked to recognised revenue, not the receipt of cash.

I can say from hands-on experience that people try it on all the time, and fortunately in most US software companies, the procedures are in place to detect and prevent this (although with collusion, some fraud if tough to detect and crack).

Of course, if there was such a conspiracy, you do have to ask why Autonomy’s due diligence/e-discovery tools didn’t pick it up: You were smoking your own dope, chaps, surely?