ROUND ROCK, Texas (
has updated investors on its
, revising its
to account for a possible $100 million settlement.
In a statement, Dell explained that the liability will establish a reserve for "potential settlement" of the SEC's investigation into its prior relationship with
Dell's first-quarter net income has been reduced by 5 cents a share as a result of the liability. Excluding items, the company's earnings per share do not change.
"The settlement would involve a civil injunctive action against the company for alleged violations of certain federal securities laws, including the antifraud provisions of federal securities laws, relating to certain accounting and financial reporting matters," explained the statement.
According to Dell, the settlement would also include "negligence-based" fraud-charges, and other non-fraud charges related to "company disclosures and alleged omissions" prior to fiscal 2008. These are related to the company's commercial relationship with chipmaker Intel, it added.
The company also explained that CEO Michael Dell and SEC staff have started discussions on a settlement framework related to the Dell chief. This, it said, would resolve allegations on disclosure and alleged omissions prior to fiscal 2008. Any settlement "would not include any bar against Mr. Dell's service as an officer and director of a public company," according to Dell. The PC maker added that any settlement would be made without admitting or denying the SEC's allegations.
Trading in Dell shares was briefly suspended earlier today, but has now resumed. The company's stock was down 32 cents, or 0.32%, to $12.75 in extended trading.
-- Reported by James Rogers in New York
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