WorldCom finds another $3.3B in errors


WorldCom says it has found another $3.3 billion in accounting errors

NEW YORK (CNN/Money) -- WorldCom Inc. said Thursday it discovered an additional $3.3 billion in improperly reported earnings, on top of the $3.8 billion it disclosed in June, which galvanized investors and regulators to move to end abuses in corporate America.

WorldCom, which filed for bankruptcy after disclosing its first accounting errors, said it was continuing its internal financial investigation.

The once fast-growing long-distance and Internet services company filed the biggest bankruptcy in U.S. history last month after disclosing the accounting abuses -- moves that led to passage of tough new laws meant to curb corporate fraud and hold chief executives more accountable for how their companies are run.

Last week, two former WorldCom executives -- chief financial officer Scott Sullivan and controller David Myers -- were arrested and charged with hiding the $3.8 billion in expenses and lying to investors and regulators in a desperate bid to keep the company afloat.

The fraudulent accounting disclosed in June occurred in 2001 and the first half of 2002. When WorldCom made its disclosure on June 25, it said it would go back and review financials from prior years.

WorldCom also said it may write off as much as $50.6 billion in goodwill and other intangible assets when restated results are released for 2000, 2001 and 2002.