FSA to probe iSoft accounts

24-08-2006

The software firm contracted to upgrade the NHS' computer systems, iSoft, has today announced that it is being investigated by the UK's financial services watchdog over possible "accounting irregularities".

It is thought that the probe by the Financial Services Authority (FSA) will examine whether iSoft misled investors over how much it had earned.

The healthcare software company announced on August 8th that it had completed an initial investigation into potential irregularities in its accounts.

The provisional inquiry, conducted by iSoft's auditors, Deloitte, found that there was evidence of irregularities concerning the company's annual accounts for 2004 to 2005.

At the time, iSoft confirmed that Deloitte had identified that its revenues appeared to have been stated earlier than they should have been.

The independent investigation subsequently concluded that there were grounds for a more formal probe into iSoft's financial affairs.

Revealing the FSA's decision to examine the company's accounts, iSoft said in a statement: "The findings of the initial investigation were passed by the group to the FSA..

"The group has now received notification from the FSA that they will be undertaking a formal investigation into the possible accounting irregularities."

The software firm, which has twice delayed the publication of its annual results due to changes to accounting rules and identified errors, is expected to finally release the data on Friday, ahead of a deadline on Monday.

The accounting scandal is the latest problem to beset the company, whose £6.2 billion contract to upgrade the NHS' IT network has been hit by a string of delays.

It has also been forced to renegotiate the terms of its loans with its banks as a result of profit warnings.

Yesterday, MPs recommended that iSoft should be investigated by the Department of Trade and Industry (DTI) amid growing concern about the company's activities.


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