SEC investigating Huron for accounting errors
On Tuesday August 11, 2009, 7:21 am EDT
(Reuters) - Huron Consulting Group Inc (NasdaqGS:HURN - News), whose shares plunged in the wake of an accounting scandal, said it is being investigated by the U.S. Securities and Exchange Commission for acquisition-related payments and will delay filing its latest quarterly report.
Earlier this month, the consulting firm's entire top management team left as it announced the scandal that forced it to restate more than three years of results, slashing its profits by almost half because it misreported costs related to acquisitions.
Huron's board audit committee discovered that shareholders of four businesses that Huron acquired between 2005 and 2007 redistributed portions of their acquisition-related payments among themselves and to certain Huron employees.
The company continues to evaluate the impact of the restatement, it said in a regulatory filing.
It intends to file its quarterly report for the three months ended June 30, as well as the restated results of the prior periods, as soon as possible.
Chicago-based Huron, which was founded by two dozen partners from the collapsed accounting firm Arthur Andersen, said it intends to cooperate with the SEC in its investigation.
Huron built a reputation as an expert on litigation and regulatory issues. It advised United Airlines, a unit of UAL Corp (NasdaqGS:UAUA - News), on its bankruptcy and helped uncover accounting shortfalls at mortgage giant Fannie Mae (NYSE:FNM - News). That eventually led the SEC to charge Fannie Mae with fraud.
Shares of Huron closed at $13.54 on Nasdaq Monday. They have fallen 69 percent since July 31, when the company first announced it would restate results and its chief executive resigned. (Reporting by Sweta Singh in Bangalore; Editing by Mike Miller)