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Good example ken. Actually, Halliburton switched to a much more accurate method of accounting (for their industry). More than likely they claimed revenue based on the percentage of completion and now-a-days it's pretty easy to be very, very accurate. The only change they made was recognizing the profit on change orders they were confident they would collect on. Usually, these changes have already been agreed on with the owner (Joe: I want you to make this change. Sam: it's be cost plus. Joe: OK, here's your notice to proceed). Six months later, the paperwork gets processed and an official change order to the contract is issued. Sometimes, the company has already billed for the changes before the paperwork catches up. On big contracts that can take a lot of time since twenty seven gazillion people have to sign off on every single piece of paper. Everyone knows it's going to be billed, and everyone knows it's going to be paid, but the C.O. is still working it's way through the approval process.

This is the most ridiculous thing I have ever seen. I am going to love watching Klayman being publically humiliated. I hope Halliburton countersues.

I spent my entire carrier in the business that Halliburton is in. In the 80's the vast majority of EPC contracts were "cost plus" and yes the client was supposed to absorb the over runs but usually after they were forced to in court. In the late 80's fixed cost projects became the norm but over run charges were written into the contracts as "contingency fees". All overrun claims were considered accounts receivable, unless challenged by the client, and legitimate earnings . In the cases that there were disagreements as to the amount of money being billed for overruns or schedule penalties or incentives the challenged costs were "off the books" until the negotiations were completed. Every project, most by Halliburton, were mega petrochemical complexes with multi-year schedules and strict payment schedules and conditions. At any given time Halliburton had in excess of 20 billion dollars in procurement activities on as many as 100 major projects around the world. In many cases, to meet schedule incentives, it would use its own money to purchase schedule sensitive material and equipment and then bill the client later. There is absolutely NOTHING that Halliburton did that was illegal, immoral, or unethical