Securities and Exchange Commission
opened a formal investigation into the accounting problems the company disclosed two weeks ago.
The television and sports-team giant said in a government filing that it's cooperating with the probe and couldn't predict its outcome.
Cablevision said June 18 that an internal probe found employees at its Rainbow programming arm improperly accelerated the accrual of marketing expenses "and, in some cases, fabricated invoices." Fourteen employees were fired, including including Kate McEnroe, the head of its American Movie Classics channel.
The filing said the improper accruals are insignificant to previously reported financial results of both Cablevision and Rainbow.
Cablevision said in June that its audit committee has hired an outside attorney to conduct an investigation into the problems. The expense accruals at issue, said Cablevision, had the effect of "inappropriately accelerating into one year expenses that should properly have been accrued in the following year."
Thursday's filing said the lawyer, Wilmer Cutler & Pickering's William McLucas hired PricewaterhouseCoopers to assist in the probe.
In June, the company said it appeared that $6.2 million of expenses for 2003 were improperly recognized in 2002. All but $1.7 million of that amount was identified and reversed before the company released its 2002 results. Based on its review, which Cablevision said took five months, the company thinks improper accruals in 2000 and 2001 were similar in size to those in 2002.