Nortel Networks Corp.

Toronto, Canada: (May-22-07) The Ontario Securities Commission (OSC) had filed charges against telecom equipment maker Nortel Networks Corp., alleging that the company was guilty of misleading accounting practices and regulatory filings that were made several years ago. The suit stemmed from an investigation carried out by the OSC. The suit stated that Nortel, a leading issuer in Ontario's capital markets, admitted that it filed misleading financial statements due to improper accounting for provisioning and revenue recognition. It agreed that its financial statements for the 2000 fiscal year, the first two quarters of 2002, and the final two quarters of 2003 were misleading, and that its accounting for provisioning and revenue recognition did not adhere to generally accepted accounting principles. In a settlement reached, the company agreed to pay $1 million CAD or $917,000 USD toward the cost of investigation by the Ontario Securities Commission, Canada's major securities regulator. Nortel will not have to pay any monetary penalty because it cooperated with the commission's investigation. [REUTERS: NORTEL ACCOUNTING]

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Last updated on Jun-24-08