Nortel admits to inappropriate accounting

Canadian equipment supplier Nortel Networks has admitted that some of its former executives – including ex-CEO Frank Dunn – used inappropriate accounting methods for its 2003 results to ensure that the management would receive large bonuses. All the executives involved in the scam have now been fired, and according to current CEO and President Bill Owens, Nortel has demanded that they repay the bonuses, threatening to sue if they do not comply. The company has now reported a profit of USD434 million and revenues of USD10.19 billion for 2003, compared to the USD732 million and USD9.81 billion it had initially published in early 2004. As part of wider plans to clean up its act, Susan E. Shepard has been appointed as the company’s new Chief Ethics and Compliance Officer.