The carrier, which is also subject to a Securities and Exchange Commission investigation, said it will lower its reported 2001 revenue by $1.33bn and its 2000 revenue by $889m. It had originally reported 2001 revenue of $19.65bn and 2000 revenue of $16.61bn.
Qwest is one of the companies at the heart of probes over revenue recognition practices at major carriers, which are suspected of artificially boosting reported revenue using practices such as capacity swaps, where carriers simultaneously buy capacity from each other and book it as a capital expense so it does not hurt the bottom line.
The company in September said it would remove $950m of revenue from its books related to capacity swaps. In October it added another $531m to the list of deductions, relating to other capacity sales.
Qwest said the latest restatements come as a result of billing errors… that Qwest subsequently determined to be inappropriate. It also said that in certain circumstances it recognized revenue before the sales process was complete. Other individually insignificant errors in aggregate also accounted for the restatements.
Source: Computerwire
