15 August 2002 | Author: Lyndsay Menzies COO

AOL Finances Investigated

US media and entertainment firm, AOL Time Warner has admitted that it may have overstated the revenues of its AOL arm by as much as £32m in three transactions over 6 quarters.

AOL had previously stated: "Our accounting is appropriate and in accordance with generally accepted accounting principles and our auditors, Ernst & Young, have repeatedly confirmed that."

An investigation, by the US stock market regulator and the US Justice Department has been ongoing for several weeks.

AOL Time Warner Chief Executive Richard Parsons said in a statement that he plans to "implement additional internal controls at AOL" once the company's own investigation is completed.

In related news, AOL spokeswoman Tricia Primrose confirmed that David Colburn, an executive vice president and president of business development for AOL Time Warner, left the company in early August. Colburn, who had overseen the business affairs division of America Online, had already given up control of day-to-day operations in July.

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