WASHINGTON DC: ‘ SEC Charges Two Executives at Dallas-Based IT Company with Mischaracterizing to Inflate Company’s Reported Revenue Stream ‘

#AceFinanceNews – UNITED STATES (Washington D.C) August 28 2014 –

The Securities and Exchange Commission today charged two executives at a Dallas-based information technology company with mischaracterizing an arrangement with an equipment manufacturer to purport that it was conducting so-called “resale transactions” to inflate the company’s reported revenue.


An SEC investigation found that then-CEO Lynn R. Blodgett and then-CFO Kevin R. Kyser caused the disclosure failures at Affiliated Computer Services (ACS), which has since been acquired by Xerox Corporation. ACS provided business process outsourcing and information technology services. Shortly before the end of its first quarter in fiscal year 2009, ACS faced a scenario where the company’s revenue was set to fall short of company guidance and consensus analyst expectations, so ACS arranged for an equipment manufacturer to re-direct through ACS pre-existing orders that the manufacturer already had received from one of its customers.

This gave the appearance that ACS was involved in resale transactions, but ACS in fact had no such involvement. ACS went on to report $124.5 million in fiscal year 2009 revenue from these transactions as though it had resold the equipment itself.

Blodgett and Kyser have agreed to pay nearly $675,000 to settle the SEC’s charges that they and ACS did not adequately describe the arrangement in its financial reporting, and the purported revenue in turn allowed ACS to publicly report inflated internal revenue growth (IRG). Blodgett and Kyser emphasized the inflated IRG as a key metric in earnings releases and other public statements to investors, and a portion of their annual bonuses was linked to IRG.

“ACS positioned itself in the middle of pre-existing transactions without adding value, but still improperly reported the revenue. Blodgett and Kyser knew the truth about these deals, and they were responsible for ensuring that ACS accurately disclosed the full story to investors,” said David R. Woodcock, director of the SEC’s Fort Worth Regional Office and chair of the agency’s Financial Reporting and Audit Task Force.

“This enforcement action holds them accountable for failing to uphold that responsibility.”

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AFN2014

WASHINGTON: ‘ President Obama New Push to Secure Climate Accord Causes Problems for Democrat’s ‘

#AceFinanceNews – UNITED STATES (Washington) – August 29 – President Obama’s new push to secure an international climate change accord is another headache Democrats don’t need this fall.

Several vulnerable House and Senate Democrats kept quiet on the administration’s talks with the United Nations over a deal to reduce global greenhouse gas emissions.

The effort could offer Republicans another opportunity not only to hammer red-state Democrats for what they’ve deemed are Obama’s job-killing energy policies but also to attack Obama for a pattern of “lawlessness,” if he seeks to go around Congress to secure the pact.

But Democrats are, at this point, almost used to doing damage control after a new controversial administration policy crops up. Rep. Nick Rahall (D-W.Va.), one of his party’s most vulnerable incumbents, wasted no time in heartily attacking the president.

“This administration’s go it alone strategy is surely less about dysfunction in Congress than about the president’s own unwillingness to listen to our coal miners, steelworkers, farmers and working families,” he said in a statement.

And some vulnerable Democrats may get a boost from it. Rep. Scott Peters (D-Calif.), who leads a House climate task force, said he agreed with the move in principle.

“I don’t think it’s very surprising, and under the circumstances it’s the right thing to do,” he told The Hill.

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WASHINGTON: ‘ President Obama Finds Way to Punish Russia by Sanctions on Russian Direct Investment Fund Though it Partners With Corporate American Companies ‘

#AceFinanceNews – UNITED STATES (Washington) – As President Barack Obama warns of stepped-up economic punishments against Russia for its military incursions inside Ukraine, U.S. sanctions have so far avoided one prominent financial institution: the $10 billion Russian Direct Investment Fund, which has partnered with brand-name American companies and whose advisers include top U.S. and European private equity executives.

​Despite its ties to Russian state businesses and officials, the Russian Direct Investment Fund has managed to operate unaffected by the sanctions imposed by the U.S. and EU in response to Russian President Vladimir Putin’s military actions in Ukraine.

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