Bonum Certa Men Certa

Confirmed: Microsoft Still Manipulates Financial Reports

Classified



Summary: A real case of investigative journalism from Paul McDougall shows that Microsoft misreports its results

MICROSOFT is not new to fraud charges. Even when the company hit its peak value (or thereabouts) the company was caught manipulating reports, after a whistleblower showed evidence. Microsoft later paid him several millions of dollars to drop the charges and go away, but the SEC did not go away. This whole story and many others can be found in our wiki. There are some more recent allegations as well.



Let us bear in mind that Windows profit declines despite Microsoft cheating by the numbers as Paul McDougall helps reveal: (thanks go to Girts for the pointer)

Microsoft's most recent Windows sales totals got a boost from the fact the company quietly added revenues previously assigned to other groups to its operating systems unit, a bit of accounting legerdemain that, along with other bookkeeping moves, helped the Windows group post big gains in the past quarter, according to an InformationWeek analysis of the software maker's SEC filings.

[...]

Just leaving Bolzano after three nights here for SFSCON (a small but perfectly formed FOSS conference). Passing through the tiny airport I noticed an unusual security requirement – which was being actively enforced. Despite apple strudel (that’s a delicious, giant pastry filled with spiced apple and mixed berries) being a major tourist item on sale in Bolzano, it’s banned on aircraft here.



There are surprisingly few comments on this article, which is an exclusive. More people need to see this. One commenter says: "Given that the reason Microsoft's share price has maintained its price is due to what is happening in its three traditional core businesses, could Microsoft be burying underlying sales and growth problems simply by the way it uses inter-business charges? After all, investors have now become so blasé about the fact that Microsoft is bleeding around more than a $1B a year in its Online Services Division, what matter whether it loses $1B or $2B. However, adding another $1B to the three core business makes things look somewhat rosier than perhaps they really are.

"Questions should be asked, more especially given the recent sale of $1.3B shares by Microsoft CEO Steve Ballmer."

Not just questions should be asked; lawsuits should be filed, too.

Here is another such post which relies on the above as its source and adds:

Microsoft declined to comment on how the company's Windows division gained the extra $259 million.


Why can't Microsoft comment? Probably because it's true. Let us remember that Microsoft's former CTO quit the company and was paid to keep quiet

Novell admitted playing the bucket game several years ago, which leads to the question: shouldn't shareholders be allowed to receive compensation if they sue the company for misreporting figures while it's public traded? Shouldn't the SEC step in again?

"One strategy that Microsoft has employed in the past is paying for the silence of people and companies. Charles Pancerzewski, formerly Microsoft’s chief auditor, became aware of Microsoft’s practice of carrying earnings from one accounting period into another, known as “managing earnings”. This practice smoothes reported revenue streams, increases share value, and misleads employees and shareholders. In addition to being unethical, it’s also illegal under U.S. Securities Law and violates Generally Accepted Accounting Practices (Fink).

--2002 story about Charles Pancerzewski, Microsoft

Comments

Recent Techrights' Posts

Attacks on Techrights Are Only Making Techrights Bigger and Even More Popular
A week ago they offered to settle with us
EPO Staff Can Go Listen to Richard Stallman Next Week in Munich (Technical University of Munich, Rudolf-Diesel Hörsaal (MW2001) on Campus Garching at 18:00)
"The talk is open to the public and attendance is free. Registration is not required."
At IBM, Relocation Means Layoffs (Downsizing)
Silent or 'invisible' layoffs?
Dystopian Trends in Technology Make Richard Stallman More Relevant Than Ever
It's good to see him attracting vast audiences
Richard Stallman (RMS) Announced His Talk Less Than 24 Hours Before It Took Place and Still Filled Up the Auditorium at Sapienza Università di Roma
Photos from yesterday evening [...] It looks like it was a very successful event
 
The DDoS Attacks by Microsoft's Scam Altman and Other Slop Charlatans and Frauds is Hurting the FSF, Delinking It From Copyleft Projects
This impacts a lot more than access to the licences
Microsoft Scanning Faces in Photos People Upload to Microsoft (Even Unconsciously), Slashdot Turns Report About It Into "Microsoft Sez" (Says)
Or "let's repeat the lies from a PR person/Microsoft's publicist"
[Teaser] Angel Aledo Lopez the Manipulator (Nepotism, Poll Rigging, and Other EPO Corruption)
We'll discuss this later today or tomorrow, based on internal EPO material
Epic Metaphor for End of IBM: "The IBM Demolition is Down to the Last Shards!"
Nothing lasts forever
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Tuesday, October 14, 2025
IRC logs for Tuesday, October 14, 2025
Proprietary and DRM Prisons Spiralling Down the Sinkhole? Not Just Yet.
Let's hope that more people will flee to GNU/Linux
The European Patent Office (EPO), the Second-Largest Institution in Europe, is Cracking Down on Recreational Activities
Without AMICALE activities, and as staff already says it's pressured to work more for less, how can the EPO recruit bright people?
Transparency: FSFE financial reports exclude speaker fees and expenses
Reprinted with permission from Daniel Pocock
Many Developers Have Many Political Views, They'll Never Agree on Everything
It's an effort to divide and destroy, not build
Gemini Links 14/10/2025: An Opportunity to Consider GNU/Linux and Another Simple IRC Client
Links for the day
Slopwatch: UbuntuPIT, LinuxSecurity, Google News, and the Serial Slopper Brian Fagioli
Nothing of merit here, just more slop
Links 14/10/2025: Lack of Trust in Slop and "Retirement Challenges"
Links for the day
Rhonda D'Vine, Gerfried Fuchs, Pronouns & Debian pregnancy cluster
Reprinted with permission from Daniel Pocock
Central Staff Committee of the European Patent Office (EPO) Warns That EPO Management is Robbing or Manipulating Pension Funds Again
Faking "growth" is just about as bad as forgery
Probably a Lot Worse Than LLM Slop: GNOME Tying Itself to Divisive Politics, Even Where It's Clearly Not Relevant
Something has gone terribly wrong in GNOME
Links 14/10/2025: Microsoft OneDrive Scanning Faces in Photos (Without Asking First), "OpenAI Says It Will Move to Allow Smut"
Links for the day
They Generally Don't Like Scholars, as They're Less Compelled or Pressured to Repeat What Corporations and Oligarchs Say
People who loathe scholars have an agenda in mind that, unlike that of reasonable people, revolves around controlling people
Belated New Article About Last Thursday's Lecture by Richard Stallman in Helsinki, Finland
there are good reasons to pay with cash, not limited to privacy
Attacking Richard Stallman Has Become 'Career Suicide'
If you're going to viciously attack somebody, make sure your arguments are rock-solid
Microsoft's Failing XBox Business Has Turned Games Into Funerals
How does it feel to depend on Microsoft?
Yesterday's "Distinguished Lecture" by Richard Stallman Possibly Attended by Close to 1,000 People
The capacity of the place is about 900
Slop Poisons Everything
Imagine wanting to find what Torvalds has just said or what has just been released
Taking Software Freedom 'Mainstream'
interest in Software Freedom must have grown
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Monday, October 13, 2025
IRC logs for Monday, October 13, 2025
Gemini Links 14/10/2025: Ada Lovelace Day, Sony CLIE PEG-TG50 Review, Why to Avoid Network Solutions
Links for the day
The EPO's War on Techrights Was a Massive Mistake
The EPO started the SLAPPs after we had published a few hundreds of articles; we've since then published close to 6,000 because the attacks on us emboldened insiders to help us
General-Purpose Computers to Become Growing Area of Coverage
Without them, we have little left for controlling our lives
"They missed a great opportunity to shut up." -Jacques Chirac
Brett Wilson LLP has been trying to cheat the legal system many times
Harassment evidence: Switzerland, overcrowded fitness and yoga centers, incompetence and racism in accident response
Reprinted with permission from Daniel Pocock
Vincent Danjean & Debian NXIVM collateral, blackmail risks
Reprinted with permission from Daniel Pocock
In Sweden This Past Friday Richard Stallman Explained Why Copyleft is Important
And he didn't have to 'bash' BSDs, either
IBM Layoffs Due to a Lack of Money and Company Debt Rising by Almost 10 Billion Dollars in 6 Months
IBM didn't buy Red Hat for any ideological reasons; it was a fast "cash grab" for revenue
Forbes Already Stopped Being a News Sites. Now It's a Spam and Propaganda Platform for "Paying Partners" (Companies).
news from Forbes became very scarce
Is the Second-Largest Institution in Europe (EPO) Gradually Becoming More Like a Sweatshop?
Underpaid, unqualified, inexperienced and incompatible people are already recruited to replace veteran examiners
The Register MS Has No FOSS Coverage Anymore
The Editor in Chief is like a Microsoft plant
Links 13/10/2025: "Toasty Subwoofer" and WiFi Speakers "Are About To Go Dumb"
Links for the day
Gemini Links 13/10/2025: iNaturalist and Tove Jansson’s Moominpappa at Sea
Links for the day
Microsoft Does Not Deny That Large Retailers Like Walmart, Costco and Target Are Giving Up on XBox (and Not Stocking It)
No doubt XBox is in trouble and rumours suggest that more mass layoffs are imminent
We'll Encourage Richard Stallman to Talk About Software Patents at the EPO Next Week When He Visits Munich (EPO Headquarters)
Go listen to Richard Stahlmann
Investigative Journalism Protects Society From Corruption, Crimes Against Women, Assaults on Civil Society
"what is the point of men doing military practice to defend a system that is so rotten?"
Swiss pimp usurping reputation of legendary Tissot boss Francois Thiébaud from France (BaselWorld, SWATCH Group SA)
Reprinted with permission from Daniel Pocock
Paris 'Love Nest' & Debian Outreachy: from Lycée Lakanal to ENS Cachan, Cr@ns, nepotism
Reprinted with permission from Daniel Pocock
Richard Stallman to Give Public Talk in 3 Hours, Then in the Technical University of Munich (Germany) Next Week
Richard Stallman at TUM on 21.10.2025 18:00, MW2001
Arnaud Parreaux lost case defending rogue employer
Reprinted with permission from Daniel Pocock
Mathieu Elias Parreaux declared bankrupt in Switzerland
Reprinted with permission from Daniel Pocock
Breakdown of the Rule of Law and Patent Law in the European Union (EU)
The EPO cannot recruit suitably qualified patent examiners this way, let alone retain them
Gemini Links 13/10/2025: Good Films, Wizard of Earthsea, Upgrading the Steam Controller's Stick
Links for the day
Leaks and Whistleblowers: Our Plan for Today
Society simply cannot advance when too many people self-censor
It's Not Justice When One Side Denies the Other Side the Ability to Even Speak
At this stage, Brett Wilson LLP is in my humble opinion acting in contempt of the Court
Links 13/10/2025: Australian Catholic University Uses Slop to Libel Students, Canada Threatens to Kill Beluga Whales
Links for the day
How Not to Silence Tux Machines (It'll Only Backfire, Badly)
defending Microsoft while attacking this site
Slopwatch: UbuntuPIT and Google News
It seems abundantly clear that Google News and Google in general participates in the slop epidemic
Vincent Danjean (not INTERPOL), Claire Bardel & Debian pregnancy cluster
Reprinted with permission from Daniel Pocock
Christmas lynchings: Martin Krafft (madduck), Penny Leach (mjollnir) & Debian pregnancy cluster
Reprinted with permission from Daniel Pocock
Gemini Links 13/10/2025: Birthdays and "Committee Unable to Contact Nobel Prize Winner"
Links for the day
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Sunday, October 12, 2025
IRC logs for Sunday, October 12, 2025