Accounting Investigations and Restatements
MWL has been engaged by various companies' outside counsel to address alleged accounting improprieties and other instances in which a firm’s financial statements may require restatement. In particular, MWL personnel have been involved in investigations in which a company “whistleblower” alleged management impropriety over accounting practices. In one case related to a wireless carrier, we investigated the company’s use of estimates, and the assumption underlying those estimates, in deriving loss provisions.
In another matter, we investigated allegations of manipulation of inventory quantities to allegedly understate costs of goods sold and thereby overstate profits. In another case involving a local public company, MWL performed detailed analysis related to revenue recognition issues in which it was alleged that company management manipulated the terms of large sales transactions in order to provide
the appearance of completed transactions, and artificially inflate quarterly operating results, when in reality there was no substance to those sales transactions. In these cases, MWL worked with counsel and company auditors to determine restatement impacts to the financial statements.