Incredible or what!
MCI achieves milestone in restatement
Writedowns and adjustments result in $73.7 billion loss
By Mike Maynard, CBS MarketWatch.com
Last Update: 10:29 AM ET March 12, 2004
WASHINGTON (CBS.MW) -- Moving to put the largest Chapter 11 bankruptcy ever behind it, MCI on Friday restated its results for the years 2000 through 2002 to show a staggering loss of $73.7 billion.
The action by the Ashburn, Va.-based telecom giant (MCWEQ: news, chart, profile) "culminates the largest and most complex financial restatement ever undertaken," said Bob Blakely, MCI's chief financial officer, in a statement.
The company's net loss on a restated basis amounted to $48.9 billion in 2002, followed by $15.6 billion in 2001 and $9.2 billion in 2002. Also as restated, MCI had $39.3 billion in revenue for 2000, $37.7 billion for 2001 and $32.2 billion for 2002.
MCI, the long-distance carrier formerly known as WorldCom and run by the now-indicted Bernie Ebbers, said that it expects to emerge from bankruptcy next month and that work continues in the meantime on completing its 2003 financial statements.
The restatement process called for reauditing, revalidating and correcting accounting records and reviewing the accounting for major acquisitions dating all the way back to 1993, when Ebbers began an unprecedented string of deals that turned MCI into one of the biggest players in U.S. telecommunications by the end of the decade.
But amid persistent accounting questions, the company fell from grace with investors and was forced to file for Chapter 11 federal bankruptcy protection from creditors in July 2002, after evidence of massive fraud surfaced. Ebbers was indicted by federal authorities on securities fraud charges last week.
The restatements "do not have any impact on our current substantial liquidity position," said Blakely. MCI pegged its consolidated cash and cash equivalents position at about $6 billion at the end of 2003. |
