 |
Cross their hearts The Dog Ate My CFOBy Rick Horowitz
AN OPEN LETTER TO OUR CUSTOMERS AND SHAREHOLDERS These are challenging times for American business. Every day, it seems, brings another disturbing story of corporate misbehavior, of bad deeds in high places. Of particular concern to the public, of course, have been the many recently disclosed cases of corporate accounting irregularities. While some of these incidents have involved relatively insignificant sums, others have put in dispute amounts now rising into the billions. Taken together, these cases have shaken investor confidence and have contributed to current levels of market uncertainty. At HypeIT, we share your concerns. We have watched developments with growing dismay and great sadness. For the many dedicated officers and employees of HypeIT, "Putting Shareholders First" isn't just a slogan; it's a hand-carved titanium plaque in our atrium. As you know, the Securities and Exchange Commission has attempted to put an end to this unfortunate wave of accounting scandals by requiring the top executives at nearly 700 leading companies to certify under oath that their latest financial reports are accurate. These certifications were due last Wednesday, August 14. I welcome this action by the SEC, and I want to tell you of our efforts to comply with the SEC's requirements. It turns out to have been a little more complicated than we expected. In the days preceding August 14, HypeIT's executives were confident that certifying our financials would be a simple matter of signing on the dotted line. In fact, we were so confident (and so busy serving our millions of loyal customers) that we didn't even start our review process until mid-afternoon on Tuesday, August 13. You can imagine our surprise, then, when the first indications began to surface that an additional degree of scrutiny might be necessary. Anyone who has ever owned a pocket calculator knows how the keys are all bunched together; if you don't have skinny fingers, there's always the chance you'll hit the wrong key and ruin all your careful calculations. In HypeIT's case, we believe it was a simple matter of hitting the "9" instead of the "6" in reporting our overall earnings for the first quarter of 2002. Now, had this apparent oversight taken place in the "ones" column, it wouldn't have been any big deal, and would hardly be worth a mention. Occurring as it did, however, somewhat farther to the left, it made for a rather serious overstatement in our final figures, as did the apparently inadvertent striking, in our fourth-quarter report for 2001, of the "multiply" key instead of the "minus" key on at least five separate occasions. These things happen, though we've given the head of our data-entry division a good chewing out. (He's a bit of a chub himself, and he tends to hire people who look the way he does.) In any event, since we couldn't rule out the possibility of additional errors, we determined that an immediate, in-depth re-examination of our books was the only appropriate response. And that's just what we would have done, except that our chief internal auditor was at the dentist. If you've never had root-canal surgery, believe me, it's not the kind of thing you can interrupt. That's when our executive committee decided to check all the books ourselves -- so of course that's when the copying machine broke down. Just try getting those repair people to show up on short notice. Impossible! Anyway, they didn't make it until Wednesday afternoon, and then they didn't have the right parts with them, so they were going have to call the factory and that was going to be another two days, minimum. Sometimes, when things start spinning completely out of control, the wisest course is to step back and regain your perspective. Instead of rushing around like a lunatic, signing something I couldn't be sure about, something that might lead to even more questions, I decided to take a deep breath and put a little distance between me and Wall Street's many problems. That's what I've done, and let me assure you: Things look very different when you're sitting in a place with umbrella drinks, sandy beaches and spectacular sunsets. And no extradition treaties. Posted 8/15/02. Leave
some of your worries behind right here at "Rick's"! (You'll be
glad you did.)
|
  |
Rick Horowitz
