GAO study reveals 10% of public firms restated earnings since 1997

By Michael Fraase

Monday, 28 October 2002 02:19PM CST

Section: Business

A General Accounting Office (GAO) study released last week reveals that one out of ten of all publicly traded companies restated earnings between January 1997 - June 2002. The government agency estimates the accounting revisions cost investors about US$100 billion during the period studied.

The report pulled no punches about the cause of the restated earnings and the impact on the economy:

“Corporate management, boards of directores, and auditors failed in their roles, as have securities analysts and credit rating agencies that did not identify problems before investors and creditors lost billions of dollars.”

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