HP knew all about Autonomy losses

A bombshell has dropped on HP’s claims that it knew nothing about Autonomy’s accounting practices when it bought the outfit.

The Financial Times  has found emails from HP which indicate that senior executives were aware of Autonomy Corp’s accounting practices months before a whistleblower flagged them, prompting HP to write down Autonomy.

The maker of expensive printer ink has said it was a victim for having paid $11.1 billion to buy Autonomy in 2011. It took a writedown of $8.8 billion in November 2012, accusing Autonomy officials of accounting fraud.

HP apparently knew of Autonomy’s practice of selling hardware to clients at a loss because it was well documented by auditors and a report was provided to HP after it bought the British software maker.

HP executives were included in communications about Autonomy’s hardware sales before the whistle-blower brought the transactions to light, FT said.

In an October 2011 email that Chief Executive Meg Whitman was copied on, Autonomy cited difficulties it was having in selling HP hardware.

HP claims that while it eventually learned about the hardware sales, it knew nothing of the accounting improprieties until the whistleblower came forward.