Philips looking at accounting issues in Mexico

AP News
Posted: May 25, 2011 7:34 AM
Philips looking at accounting issues in Mexico

Royal Philips Electronics NV is investigating possible accounting mistakes at its Mexican business in 2009, but the company says the amounts in question are not large enough to force the company as a whole to restate earnings.

The Eindhovens Dagblad newspaper reported Wednesday it has papers from a KPMG accountant indicating the company's Mexican earnings statements may have to be adjusted. The newspaper gave no indication of the size of the potential problem. Mexico accounts for a small percentage of Philips' global sales.

Philips spokesman Steve Klink confirmed the company is reviewing possible irregularities in Mexico, adding that the company takes adherence to accounting and ethical rules seriously and would take appropriate action if warranted. However he said that if the company suspected fraud it would have reported it to criminal authorities and shareholders, and it has not done so.

Earlier this month two former Philips employees were charged with bribing hospital officials in Poland.

The paper did not say how it had obtained the documents about Mexico, but named KPMG partner Michael Rezuke as the accountant who had informed the company of the possible problem.

Shares were trading down 0.1 percent at euro19.025 at midday Wednesday.