Lucent Technologies Company Profile

\nIntroduction lambent Technologies lambent Technology is trade union Americas leading maker of telecommunication equipment and software, including switching and transmission equipment and headache communications systems. Lucent Technologies, singleted concern publicly in 1996 with an initial public whirl that was, at the time, the largest in domestic report (Hayes). In December 1999, Lucents nervous strain reached a high of $77.78 and was the nations poop most widely held declivity (Romero and Atlas). But by July 2001, Lucents sprout was trading at $6.43, the second gear was investigating its accountancy practices, and some(prenominal) former, high-level draw offrs had been sanctioned by the SEC or were infra criminal indictment for wrong-doing opus at Lucent (Romero and Atlas). The deck in line of descent observe (exhibit 1) was primarily the outcome of a November 21, 2000, announcement in which Lucent said it had to restate its financial statements as a pass of an internal investigation show accounting irregularities. Lucents restatement reduced revenues by $679 million (McGough, Bloomberg).\n\nAs primeval as June 2000, media attention had begun to be directed towards Lucents aggressive accounting policies. A Wall alley Journal article in June, 2000 suggested that Lucent Technologies might be engaging in imaginative accounting practices, noting that Lucents receivables were rising slope at 49% while revenues were rising at only 20% (Wall Street Journal).\n\nAccounting form _or_ system of government Reporting objectives Lucents chief executive Richard McGinn had turned Lucent into a Wall Street star by increasing gross revenue at a triple digit pace and was immovable to maintain Lucents developing. Many observers believed that Lucents gross revenue projections were imposed on sales executives by the chief executive who was intent on maintaining a 20 percent process rate (Berman and Blumenstein). Don Peterson was plant the ex ecutive vice president and CFO; he describe to CEO Richard McGinn and was accountable for the corporate Finance Organization. Peterson explained in a 1999 article that revenue targets were reach because stock options were used as motivational tools (William, Hart). Motivation to manage earnings was based on executive compensation for acting well on the stock market. One of Lucents revenue growth evasive action included offering deep product discounts to haul customers to purchase products now kinda of delaying these purchases. The short term result of increased period terminus sales came at the expenditure of not realizing those sales in successive years. Other tactics designed to increase current period revenues and meet utter sales targets included the point of reference of generous credit call to customers....If you want to get a full essay, order it on our website:

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