Sprint Expresses Dismay at Continuing Reports of Accounting Irregularities in Telecom Industry; Reaffirms its Accounting is Complete and Accurate
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OVERLAND PARK, Kan., June 26 /PRNewswire-FirstCall/ -- As a result of continuing reports of accounting irregularities in the telecom industry, Sprint today expressed its dismay and reaffirmed that its financial reporting strictly adheres to Generally Accepted Accounting Principles (GAAP).
(Photo: newscom.com )
"Accounting fraud and misrepresentations destroy trust between businesses and their customers, investors and employees. The accuracy of Sprint's financial statements, the ethics of our employees and the fairness of our business practices are paramount in importance," said William T. Esrey, Sprint chairman and chief executive officer.
Robert J. Dellinger, Sprint executive vice president and chief financial officer, said, "We are confident that our accounting is complete and accurate, and we welcome any questions related to our accounting practices."
He added, "In addition, we do not have the issues that are affecting others in our industry. We have no SEC investigations or 'off-balance sheet' liabilities."
Sprint has a strong system of internal accounting controls and a segregation of duties to ensure that financial statements are presented in a complete and accurate manner. In addition to Sprint's internal audit function, Ernst & Young LLP audits Sprint's financial statements.
Commenting specifically on WorldCom's alleged accounting fraud, Dellinger said, "In accordance with GAAP, Sprint capitalizes only those costs that provide future economic benefit greater than one year and meet minimum dollar thresholds. Sprint also closely monitors changes in business conditions to ensure timely recognition of any asset impairments."
In the ordinary course of business, Sprint provides terminating and originating access and wireless and wireline transport services to WorldCom. As of the end of May, Sprint's net receivables exposure to WorldCom was approximately $80 million, split roughly evenly between the FON Group and PCS Group.
Ronald T. LeMay, Sprint president and chief operating officer said, "Sprint is focused on optimizing its performance through rigorous execution of its business plan not creative accounting."
About Sprint
Sprint is a global communications company serving more than 26 million business and residential customers in over 70 countries. With approximately 80,000 employees worldwide and more than $26 billion in annual revenues, Sprint is widely recognized for developing, engineering and deploying state of the art network technologies, including the United States' first nationwide all-digital, fiber-optic network. Sprint's award-winning Tier 1 Internet backbone is being extended to key global markets to provide customers with a broad portfolio of scalable IP products. Sprint's high-capacity, high-speed network gives customers fast, dependable, nonstop access to the vast majority of the world's Internet content. Sprint also operates the largest 100-percent digital, nationwide PCS wireless network in the United States, already serving the majority of the nation's metropolitan areas, including more than 4,000 cities and communities.
SOURCE: Sprint |
