Qwest Says Used Improper Accounting

Yahoo ^ | Sun Jul 28, 9:30 PM ET

[AM2000]

DENVER (Reuters) - Qwest Communications International Inc., which is the subject of an accounting investigation by the U.S. Securities and Exchange Commission ( news - web sites), said on Sunday it used improper accounting methods in 1999 through 2001 and will restate its financial results.

Qwest, the dominant local telephone company in 14 states from Minnesota to Washington, also withdrew its financial forecasts for 2002, citing ongoing weakness in the telecommunications sector, stiff competition and softness in regional economy. It said all areas of its business have been hurt.

The Denver-based company, which also faces a criminal probe by the U.S. Justice Department ( news - web sites), said it improperly accounted for about $1.16 billion in sales of optical capacity on its network, as well as sales of communications equipment. The company said it is reviewing the accounting practices and may be required to restate all optical capacity sales.

The expected restatement of the company's financial statements will also include adjustments for three transactions relating to the sale of communications equipment.

Qwest said its new auditor, KPMG, will not be able to finalize its review of the second quarter financial report. Qwest is one of several telecommunications companies, including bankrupt carriers Global Crossing Ltd. and WorldCom Inc., to come under scrutiny by federal regulators.

[marvlus]

Here we go again??

[Guillermo]

Amazing how Bush, back in 1999, weilded such power, that he forced Qwest to do this ;)

(why isn't the left in an uproar over what Rubin did??)

[Unknown Freeper]

August is going to be soooo much fun.

[AM2000]

Tell me about it. You think this'll erase Thursdays rally? (or was it Wednesday??)

[Vets_Husband_and_Wife]

More housekeeping.

I heard this regarding QWest, so if I did,.. the market has already reacted to this news. (I'm sure QWest was one I had heard of regarding accounting problems, perhaps Global? Anyway.. they are already connected to someone in the news already).

The real deal will come after August 14th. It may even diffuse the October factor. We are considering purchasing stock around November.

What is encouraging is all indications are that the Administration is handling this just right. They are looking at "sound fundamentals", and those are in place. They aren't trying to win political seats come November, based on a fear factor like the Media. I think this may backfire tremendously on the Dems.. people are growing weary of all the media hype that is driving these markets lower (negative news constantly despite only 1% of the corporations having messed up = emotional reactions vs. solid economical facts) Good growth rate per our Government, etc.

We just have to get rid of the dust mites to complete the housekeeping (thus perhaps a bloody August),..and then can you spell B-U-L-L? :o)

We will (thanks to this administration) have cleaned up all the lying and deceit..and have a market based on TRUE value and GROWTH!! Thats a "good thing". Just MHO

[1234]

...We will (thanks to this administration) have cleaned up all the lying and deceit..and have a market based on TRUE value and GROWTH!! Thats a "good thing". Just MHO

sure; right...on....

[Dog Gone]

It's no coincidence that the White House put O'Neill on the talk shows this morning.

This story, though, has been speculated about for some time now. The question is how much they will have to restate earnings. If it's in the billions, there will be serious trouble.

[mlocher]

if you will allow me to disagree with you on some of the minutia (e.g. more dust mites to clean up -- but i did like your analogy), i totally agree with your analysis. buy, buy, buy, buy!!!

bush is doing all the right things. folks who are accused of wrongdoing and fraud are being arrested, he is not sponsoring any major shakeup of the markets, some minor things to demonstrate the culpability of the ceos to us itty bitty investors are being encouraged.

[terilyn]

You heard correctly. I'd say the market has already heard and reacted.

Closing price Friday 7/26/02 = $1.50

[Young Werther]

There he goes again. That tricky Bush was able to ensnare another telephone company in the ever spreading corruption cycle.

I haven't read the other posting yet but I am including a SARCASM ALERT!!!

[Young Werther]

I saw O'Neill on "Meet the Press". Russet is half baked if you ask me. He asked O'Neill when we would return to a surplus situation. O'Neill responded "2005" and Russet, with his buttery, bucolic retort said, "Well, we will hold you to that"

Of course, nobody held the Clintoon's feet to the fire when he stated that the troops would only be in Bosnia until the next Christmas, which was four or five Chrismases ago and still no troop withdrawl!!!

[The Great RJ]

Qwest's financial probems aren't just due to funny accounting. I'm a former Qwest customer and put up with poor service and constant rate hikes. They also lost out on Internet service and provided a decidedly poor choice especially for DSL.

I have now switched my local phone service to a local cable TV company and am saving $19 per month over Qwest and am getting excellent service. Let the competitive market decide Qwest's fate.

[The Great RJ]

Qwest's financial probems aren't just due to funny accounting. I'm a former Qwest customer and put up with poor service and constant rate hikes. They also lost out on Internet service and provided a decidedly poor choice especially for DSL.

I have now switched my local phone service to a local cable TV company and am saving $19 per month over Qwest and am getting excellent service. Let the competitive market decide Qwest's fate.

[harpo11]

The US Senate failed to even hear the volumes of evidence against the impeached president, Clinton, so he gets off, December 1998.

1999 New Year message to Americans, the rule of law is for suckers. Well, at least until a new sheriff, El President Busho, came riding into DC town January 20, 2001.

[Pylot]

Unlike some of the Dot com speculations, Qwest has a $19 Billion revenue stream that will not be affected by criminal acts of the executives.

On top of that, the senators and congress critters of 14 states are not going to let their constituents lose dial tone. Ain't gonna happen.

If you simply took the Qwest BS out of USWest, you would have a fine RBOC again. That is what is going to happen.

All of the speculative nonsense is going to go. And when it is over, you will have USWest again, this time under the able leadership of the former CEO of Ameritec.

How the government handles the debt is another question but it will.

[Myrddin]

Qwest is still my DSL line provider, but NOT my ISP. They sold that business off to MSN Broadband. MSN added horrible terms and conditions and screwed up the POP3 e-mail services. If their DSL offering dies, I'll simply install the wireless T1 connection to my ISP. It's 1/2 mile line of sight to the tower.

[Lunatic Fringe]

Dow will close at or below 7800. I'm rooting for a big selloff over the next 3-4 months. I'm saving up to open a portfolio for the rebound.

[Mad_Tom_Rackham]

August is going to be soooo much fun.

Gotta happen. Better sonner than later. Smoke them out and punnish them. This is not a political issue.

[DeaconBenjamin]

A billion here, a billion there, soon you're talking real money.