Curtis, a tough call, SEC investigations of accounting issues are never "good". Since these cover a period when another CEO (Gerstner) was at the helm, the current CEO, to clean the issue may throw the old one to the dogs. I think that the SEC is right, though, and have pointed out to such irregularities in IBM reporting. For instance, when they sold a big division, they recorded a big chunk of IP sales from "continuing" operations (which is perfectly "legal" since they recognize a lot of other IP sales as "continuing operations"), but you got to go to prior quarters where they took "one time" write offs in preparation of the sale of the division. This made it "look" as if business was continuing its march forward (one time write offs are shrugged off by the street), while really what was done was to cheat the readers of the quarterly reports, IMTO. I am not even sure that this is the issue the SEC is probing, but once they probe, they may come to that as well. I would wait for the "second shoe" to drop before making serious commitments in IBM.
zeev
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